Goldman Sachs says its time to buy value stocks and sell some tech

Traders wear masks as they work on the floor of the New York Stock Exchange as the outbreak of the coronavirus disease (COVID-19) continues New York, May 27, 2020.
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The potential for a Democratic sweep in November and a Covid vaccine means it is time for investors to shift from tech stocks to cyclical plays, Goldman Sachs said in a note Thursday.

The move, a global call from Goldman Chief Global Equity Strategist Peter Oppenheimer, is based on a pattern of short-term reversals into cyclical stocks that has occurred since the financial crisis more than a decade ago. Those situations typically last about four months and result in cyclical stocks outperforming defensive ones and a smaller outperformance for value relative to growth.

These shifts tend to happen during periods of rising bond yields and strong growth, both of which Goldman expects in the near term.