Goldman Sachs Warns US Equity Demand Vulnerable to AI Disruption

Goldman Sachs warned that household demand for U.S. equities is increasingly vulnerable to higher interest rates and economic disruption caused by artificial intelligence. While households purchased 840 billion dollars in equities during the first half of 2026, offsetting weaker corporate demand, the bank identified higher yields on cash and bonds as factors that could make stocks less attractive.

Household equity allocations have reached a record 55 percent of financial asset portfolios. The wealthiest 10 percent of households control 87 percent of these assets. Despite these risks, the bank maintains supportive baseline forecasts for 2027, provided the labor market remains stable and borrowing and market yields decline modestly.

This outlook comes as the bank expects net public equity supply to increase in 2027 by the largest amount since 2000.