---
title: "Goldman Sachs traders: The \"core bull market logic\" has been challenged in the past two weeks"
type: "News"
locale: "en"
url: "https://longbridge.com/en/news/266047499.md"
description: "Goldman Sachs' top trader Mark Wilson warned that over the past two weeks, the three core bull market narratives of the stock market—AI investment prospects, Federal Reserve interest rate cut expectations, and the sustainability of economic growth—have all come under scrutiny. Concerns about fundamentals, combined with overly crowded market positioning, have triggered the largest \"high beta momentum\" pullback since the DeepSeek incident. The earnings report from NVIDIA next week will provide a real-time interpretation of AI investment prospects, and the increasingly apparent K-shaped economic recovery pattern adds complexity to the market outlook"
datetime: "2025-11-16T01:49:13.000Z"
locales:
  - [zh-CN](https://longbridge.com/zh-CN/news/266047499.md)
  - [en](https://longbridge.com/en/news/266047499.md)
  - [zh-HK](https://longbridge.com/zh-HK/news/266047499.md)
---

> Supported Languages: [简体中文](https://longbridge.com/zh-CN/news/266047499.md) | [繁體中文](https://longbridge.com/zh-HK/news/266047499.md)


# Goldman Sachs traders: The "core bull market logic" has been challenged in the past two weeks

Goldman Sachs' top trader Mark Wilson warned that the three core bull market narratives in the stock market have faced skepticism over the past two weeks, with fundamental concerns compounded by overly crowded market positioning, leading to the largest "high beta momentum" pullback since the DeepSeek incident.

Wilson stated that the three core bull market narratives have recently faced challenges:

> The sustainability and pace of AI spending are in question, especially with increased credit financing while investment returns remain unclear.
> 
> Confidence in the Federal Reserve's expectations for a rate cut in December and a continued dovish policy in 2026 has wavered, with divergent comments from several Fed officials exacerbating this uncertainty.
> 
> The sustainability of economic activity is also under scrutiny, as the deteriorating conditions of low-income consumers and weak employment trends raise concerns about a K-shaped economic recovery and the outlook for 2026.

These concerns resonate with overly optimistic market positioning and retail investor enthusiasm, causing crowded trades in more aggressive areas of the market. Data shows that hedge fund exposure to "momentum" factors has reached its highest correlation in five years.

In the week leading up to NVIDIA's earnings report, as the market began to focus on year-end performance lock-ins, high beta momentum stocks experienced their largest decline since the DeepSeek incident.

Wilson noted that he predicted two weeks ago that if META's stock price fell another 10% and Oracle's credit default swaps continued to widen, the market would need to reassess its commitment to AI capital spending. **NVIDIA's earnings report next week will provide a real-time interpretation of AI investment prospects, but current market sentiment, positioning, and stock price performance are markedly different from two weeks ago.**

Wilson expects spending signals to be sufficient to drive AI stocks up again. However, the disadvantages of power supply in Western countries are increasingly coming under scrutiny, which could become a key constraint in the AI race.

The power bottleneck issue has been brewing throughout the year, but the direct demand for hydrocarbons and potential shortages have yet to become a focal point. Wilson anticipates that this theme will become more significant next year, posing substantial challenges to AI development.

## Limitations of Historical Comparisons and Credit Risks

Despite the market continually comparing the current tech cycle to history, Wilson believes these comparisons have clear flaws.

A study suggests that the current AI boom resembles the tech frenzy of 1997-1998 rather than the bubble phase of 1999-2000, implying that the AI investment boom may still have considerable growth potential.

However, data from the credit market is concerning. This year, 29% of dollar credit supply is AI-related, raising questions about excessive leverage in the market. While drawing credit comparisons between dark fiber and inferencing computing can be easily rebutted, it is entirely reasonable for the market to raise such concerns.

## Economic Data and Federal Reserve Policy Outlook

The debate about the broader economic situation will continue, as the reopening of the government and the end of quantitative tightening complicate market visibility in the coming weeks. However, compared to previous pessimistic expectations regarding weak consumer spending and declining Chipotle sales, the market's expectations for bad news have been fully priced in Goldman Sachs' newly established layoff tracker shows that changes in corporate labor force since the government shutdown provide reasonable confidence for the Federal Reserve to cut interest rates again in December.

Despite the increase in layoffs, earnings sentiment is rebounding strongly after third-quarter earnings reports, partly due to cost control measures.

**The K-shaped economic recovery pattern is becoming increasingly evident, adding complexity to the market outlook**. Wilson summarized that the year-end market layout is becoming extremely interesting, and investors need to closely monitor the evolution of multiple uncertainties

### Related Stocks

- [The Goldman Sachs Group, Inc. (GS.US)](https://longbridge.com/en/quote/GS.US.md)
- [NVIDIA Corporation (NVDA.US)](https://longbridge.com/en/quote/NVDA.US.md)

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