Goldman Sachs: AI Earnings Surprises End, Leveraged Outflows Hit Semiconductors on July 11

According to Bloomberg TV, on July 11, Goldman Sachs' Chief Equity Portfolio Strategist said AI-driven earnings surprises are entering their final phase. While S&P 500 companies are expected to post 22% earnings growth this quarter versus year-ago levels, investor expectations have already risen sharply, making it difficult for earnings surprises alone to drive further stock gains.

The strategist attributed recent semiconductor weakness to leveraged money flowing out of the sector. Nvidia has declined 16% from its all-time high, pushing its forward price-to-earnings ratio to 18 times—the lowest since 2019.