Goldman Sachs recommends 23 defensive stocks amid economic slowdown fears

Goldman Sachs strategists are advising investors to prepare for a more challenging year ahead for the US stock market, anticipating a slowdown in economic and earnings growth into 2027. The bank highlighted concerns over narrowing market breadth, where fewer stocks are participating in market gains, and the impact of higher interest rates on growth expectations. In response, Goldman Sachs has identified 23 defensive stocks across the health care and consumer staples sectors that exhibit low share price volatility and high free cash flow yields, suggesting they could offer protection in a decelerating growth environment. The firm noted that low-income consumer discretionary stocks have seen a recent rally, and the health care sector historically performs well when growth is positive but decelerating.