Goldman Sachs's flow team expects three big buyers to return to US stocks almost at once between late October and November, led by corporate buyback windows reopening at scale.
Around Sept. 15, roughly 40% of S&P 500 companies entered their earnings blackout period, the stretch when firms stop repurchasing their own shares.
Buyback execution during that blackout ran at just 0.8x the same period last year.
Companies can exit blackout within a day or two of reporting results, and Goldman expects ~48% of the index to be back in an open window before the end of October, with heavier buying in November.
Mutual fund year-end selling pressure fades after Halloween, and seasonal buying from retail and foreign investors historically picks up from there.
The earnings backdrop is doing the heavy lifting
Goldman strategists upgraded global equities to overweight on Oct. 12, covering the next three months, citing supportive earnings and cheaper valuations after the pullback.
The bank expects S&P 500 profits to rise roughly 27% from a year earlier.
Its forward price-to-earnings measure sits at 19.1x, down from 21.1x in early June and about 22x at the start of the year.
Prices fell while profit forecasts rose, which is why multiples compressed across the market's hottest corners.
Forward earnings estimates vs forward P/E since end of June 2026
Source: Citadel Securities October 2026 update
| Segment | Forward 12-month EPS estimates (change since end of June) | Forward P/E (change since end of June) |
|---|---|---|
| Memory | +25% | -34% |
| AI Infrastructure | +25% | -22% |
| S&P 500 | +10% | -6% |
About 47% of S&P 500 index weight reports during the five sessions from Oct. 28 through Nov. 3, a concentrated test of that optimism.
Buyback firepower is at record levels
US companies have authorized a record $1.3T in share repurchases, according to Citadel Securities managing director Scott Rubner.
Systematic funds cut exposure during the September reset and now have room to add if trends stabilize.
Looking further out, Goldman expects US companies to return a record $1.7T to shareholders through buybacks in 2027, against $600B of expected corporate equity issuance.
That supply matters because US equity issuance has already hit about $431B this year, up 98% from a year earlier, with AI-related follow-on offerings making up roughly $65B.
Strategists elsewhere see similar momentum, helped by midterm-year seasonality.
"The path of least resistance into year-end is higher."
Keith Lerner, Truist
The fourth quarter has been positive about 84% of the time in midterm election years, with an average gain of about 7%.
Risks remain on the table, including higher rates, higher energy prices, and volatility around the US midterms.
For investors, the next two weeks of earnings decide whether the buyback bid lands on solid ground.
