Goldman Sachs GroupPeter Oppenheimer, chief global equity strategist, said investors should take advantage of a 10 per cent correction in the market to buy stocks.
"I think, in terms of fundamentals, this may be a good time to return to the stock market," Oppenheimer said in an interview on Tuesday. "fundamentally, we are still in the relatively early stages of the economic cycle," he said. Despite the decline in emergency support for the economy, interest rates remain low and earnings growth is at a "reasonable" level.
Peter Oppenheimer, chief global equity strategist at Goldman Sachs Group, explains why a 10 per cent correction is a good time to return to the market.
Global stock markets fell on Monday as investors prepared for the Fed's policy decision on Wednesday. However, investors who bought bargains on Tuesday quickly returned to the market because many major investors did not see any alternative assets for the stock market.
Since the market has digested a lot of good news and returns are likely to be "much lower" than they have been in the past year or so, some volatility and a modest correction are understandable, Oppenheimer said.
Although the stock market is set to fall for the first time in eight months, Goldman Sachs Group is not the only Wall Street brokerage urging investors to seek a return to the market.
JPMorgan Chase & CoMarko Kolanovic, chief global market strategist, said Monday's decline was an opportunity to buy stocks as the global economic recovery was bound to accelerate.
At the same time, HSBC Holdings PLCStrategist Max Kettner and others said they still recommended overweight stocks and saw it as a "bargain buying" opportunity because the market was "overly pessimistic" about the economic outlook.
BlackrockThink-tanks are also among those who still recommend risk-chasing, with strategists suggesting tactical overmatching of European stocks and a neutral view of US stocks.