Goldman Sachs strategist deduces that there are some signs of overheating in the US stock market based on historical indicators.

Goldman Sachs stated that some indicators show that the optimism in the US stock market is now higher than the historical average level, but still lower than the levels seen at the peak of the market in 2000 and 2021. A team of strategists led by Ben Snider evaluated nine indicators in four categories, which reached the 100th percentile in 2000 and the 95th percentile in 2021; currently, these indicators are at the 86th percentile. The report pointed out that speculative frenzy, although not a reliable indicator for market timing, is still one of the important characteristics of past high valuation and concentrated bull market peaks. The strategists mentioned that some other signs that typically appear at the end of similar bull markets have not fully materialized in the current market environment, but are closer compared to a few months ago. These signs include disappointing economic growth, excessively large stock issuances, and the Federal Reserve tightening monetary policy.