Goldman Sachs says this ‘Goldilocks’ stock market could be in for a shock before the end of the year
In a note headlined “Goldilocks continues to escape the bears,” Christian Mueller-Glissmann and his team at Goldman Sachs argued this morning that the stock market continues to be boosted by optimism around AI and tech companies. At the same time, investors are enjoying an environment in which the U.S. Federal Reserve is expected to deliver at least one—and maybe two—more rounds of cheaper money this year.A Goldilocks economy is, as the name might suggest, something of a fairy-tale scenario: The economy is neither too hot (leading to rampant inflation) nor too cold (leading to slowing growth). It is, as the story goes, “just right.”But Goldilocks could be in for a shock before the end of the year, Mueller-Glissmann wrote. “There is a risk that Goldilocks meets one of the three bears,” he says. The S&P 500 closed up 0.59% on Friday, close to its all-time high. S&P futures were up a solid 0.53% this morning prior to the opening bell, so investors are indeed in a good mood. They are not alone. Cleveland Fed President Beth Hammack told CNBC this morning that she doesn’t see the market pricing in a “material drawback” anytime soon. And SoFi’s head of investment strategy, Liz Thomas, recently published a fascinating comparison between today’s S&P 500 and that of the late 1990s, immediately prior to the end of the dotcom bubble. The two markets are spookily similar to each other, she says, but “the clearest takeaway here is if the two cycles do end up resembling each other, we’ve still got some runway before this market rally loses steam.”So what are the bears Goldman Sachs is worrying about? They are …“A growth shock,” owing to increased unemployment or “disappointments on AI.”“A rate shock,” a result of the Fed not delivering more rate cuts.“A new dollar bear,” in which the greenback loses another 10% of its value (as it did in the first half of this year), which would hurt foreign investors in U.S. stocks—and turn them away from the American market.Fear not! (At least in the short-term.) “So far none of those shocks have materialized,” Mueller-Glissmann says. But “we think the risk of growth and rate shocks into year-end remains.”Here’s a snapshot of the markets ahead of the opening bell in New York this morning:S&P 500 futureswere up 0.5% this morning. The index closed up 0.59% in its last session.The STOXX Europe 600was up 0.23% in early trading. The U.K.’s FTSE 100was up 0.58% in early trading.Japan’s Nikkei 225was down 0.69%.China’s CSI 300was up 1.54%.The South Korea KOSPIwas up 1.33%.India’s Nifty 50was flat before the end of the session.Bitcoinrose to $112K.Join us at the Fortune Workplace Innovation SummitMay 19–20, 2026, in Atlanta. The next era of workplace innovation is here—and the old playbook is being rewritten. At this exclusive, high-energy event, the world’s most innovative leaders will convene to explore how AI, humanity, and strategy converge to redefine, again, the future of work. Register now.
Trump suggests Murdochs will have role in new TikTok deal
President Donald Trump suggested that Fox Corp. Chairman Lachlan Murdoch and his father Rupert Murdoch are involved in the US takeover of the video app TikTok from its Chinese owners.Recommended VideoIn an interview taped Friday on Fox News’s The Sunday Briefing, Trump was asked to name the individuals investing in TikTok. The White House announced on Saturday that the US operations of TikTok will be majority-owned and controlled by American investors including Oracle Corp., Andreessen Horowitz and private equity firm Silver Lake Management LLC.The deal was finalized in a phone call on Friday between Trump and Chinese President Xi Jinping, and the White House said the arrangement would be signed in the coming days.“I hate to tell you this, but a man named Lachlan is involved. Lachlan is, that’s a very unusual name, Lachlan Murdoch,” Trump said. “And Rupert is probably going to be in the group. I think they’re going to be in the group.”Trump also mentioned Larry Ellison, the chairman of Oracle, and Michael Dell, chairman of Dell Inc.The TikTok deal — designed to comply with a bipartisan law that went into effect in January 2025 requiring parent company ByteDance Ltd. to divest from TikTok in the US — would see ByteDance with a less than 20% stake. Neither the Murdochs, who control News Corp., nor Dell were mentioned in the White House announcement issued a day after the interview was taped.A person familiar with the matter said Fox Corp. will be involved in the TikTok deal as opposed to the Murdochs individually.A messages seeking comment to Dell was not immediately returned.Under the deal, Americans would hold six of the seven board seats for TikTok, the app’s algorithm would be controlled in the US and Oracle would act as TikTok’s security provider and monitor the app for safety, working with the US government.Join us at the Fortune Workplace Innovation SummitMay 19–20, 2026, in Atlanta. The next era of workplace innovation is here—and the old playbook is being rewritten. At this exclusive, high-energy event, the world’s most innovative leaders will convene to explore how AI, humanity, and strategy converge to redefine, again, the future of work. Register now.
Longtime Cracker Barrel foe urges shareholders to vote against ‘worse than mediocre’ CEO after dismal earnings
Activist investor Sardar Biglari started his eighth proxy fight against Cracker Barrel, seizing on the chain’s earnings miss, stock slide, and botched $700 million rebrand to argue that CEO Julie Masino and the board have destroyed shareholder value.Activist investor Sardar Biglari launched his eighth proxy battle at Cracker Barrel after the dining chain reported disappointing fourth-quarter earnings on Wednesday. In a filing on Thursday, Biglari, who is also the CEO of Steak n’ Shake, urged shareholders to vote against the re-election of Cracker Barrel CEO Julie Masino and railed against the chain’s management, which he deemed “worse than mediocre.” Recommended VideoBiglari’s latest campaign is part of a 14-year entanglement with Cracker Barrel in which he has repeatedly failed to get himself elected as a director. He has, however, managed to elect two candidates of his choosing (in 2022 and 2024), while fighting against his proxy battles has cost Cracker Barrel millions. Even this was cause for criticism from Biglari: “The Board has spent $31 million of shareholders’ money to prevent one of its largest shareholders [Biglari] from having a minority voice. Now the Company has become a laughingstock.”For many years, Biglari was one of the company’s largest shareholders, at one point owning nearly 20% of Cracker Barrel’s shares. He has since sold off much of his stake, and disclosed ownership of a 2.9% stake in the proxy filing. The restaurant chain’s fourth quarter earnings disclosed a miss on earnings per share, falling short on earnings per share while beating on revenue and projecting weaker customer traffic in the year ahead.Cracker Barrel’s stock fell approximately 10% in after hours trading and was down more than 8% at time of publication. Biglari, who is also the CEO of Biglari Holdings, which also controls Maxim magazine, isn’t going away. On Thursday, he urged shareholders to vote against the board’s directors, whom he accused of “severe destruction of shareholder value,” an inability to understand Cracker Barrel’s brand, and a failure to select a suitable CEO. “Instead of demonstrating the discipline and stewardship required to protect and enhance a storied brand, management has relied on ill-conceived strategies that have worsened existing challenges rather than solved them, culminating in the disastrous “brand refresh” that has ranked among this century’s worst brand blunders alongside Bud Light and Jaguar,” he wrote. “CEO Julie Masino’s tenure has been marked by repeated and highly publicized missteps, from misguided rebranding efforts to ill-fated “transformation” initiatives, that reflect the Company’s troubling pattern of tone-deafness and disregard for shareholder capital.” Biglari also took aim at the Cracker Barrel board’s marketing expert, Gilbert Dávila, whom he accused of being responsible for the chain’s struggles, and “eroding shareholder value” by approving “outsized pay packages” for Cracker Barrel executives. “Shareholders can send a message that merit and performance, the foundation that built America, rank above DEI,” he continued. Cracker Barrel has dismissed Biglari’s antics, previously tellingFortunethat the activist investor has made “numerous false and misleading claims about Cracker Barrel, its Board and management.” Shareholders have rejected nearly all of his proposals.In June,The Wall Street Journalreported that many Cracker Barrel customers were mourning the “loss of that old-timey feeling,” and the uproar escalated in August after a particular tweet by Donald Trump Jr., highlighting allegations that the rebrand was “woke.” The market reaction alone wiped out roughly $100 million from the chain’s value. At issue was, in part, the new logo that did away with the traditional “Uncle Herschel” mascot—a denim-clad old man perched on a chair beside a barrel. The redesign, which was a key part of Cracker Barrel’s $700 million modernization campaign—and was intended to reverse an outflow of customers from the chain, performance that Biglari has criticized for years—immediately ignited controversy, drawing outrage from longtime diners, Biglari, and even President Trump. Biglari used his restaurant’s social media accounts to troll Cracker Barrel over the blunder. Cracker Barrel quickly reversed course, ditching the rebranding and suspending its planned restaurant renovations. The company’s stock is down roughly 17% year-to-date. Join us at the Fortune Workplace Innovation SummitMay 19–20, 2026, in Atlanta. The next era of workplace innovation is here—and the old playbook is being rewritten. At this exclusive, high-energy event, the world’s most innovative leaders will convene to explore how AI, humanity, and strategy converge to redefine, again, the future of work. Register now.
Jerome Powell just rattled markets by calling stocks ‘highly valued.’ BofA finds 19 of 20 key metrics in the S&P 500 are ‘statistically expensive’
Federal Reserve Chair Jerome Powell made the kind of headlines this week that give stockbrokers ulcers. After a speech in Rhode Island on Tuesday, the central banker was asked about frothiness in the markets. AsFortune’s Jim Edwards reported, his reply contained six words that investors didn’t want to hear: “Equity prices are fairly highly valued.” The S&P 500 fell 0.55% on Tuesday and another 0.28% on Wednesday. Still, that’s after a string of record highs throughout the summer.Recommended VideoBank of America Research followed with a particularly well-timed research note on the S&P 500 and its soaring valuations, declaring that the benchmark index is trading at “statistically expensive levels” on 19 out of 20 key metrics. Four of these valuation metrics have just reached all-time highs, noted the team led by Savita Subramanian, head of U.S. equity strategy.On virtually all widely observed valuation gauges, Subramanian’s S&P 500 Relative Value Cheat Sheet found a wildly inflated index. The four record metrics are noteworthy. First is the index’s price-to-book-value ratio, which has surged to 5.37x, nearly double its historical average of 2.75x. The market-cap-to-GDP ratio—a popular Warren Buffett indicator—has also climbed to a record 1.8x, far outpacing its typical average of 0.69x. The price-to-operating-cash-flow and enterprise-value-to-sales metrics also reached new peaks, underscoring the unprecedented enthusiasm among investors.“Buying stocks at these multiples feels bad,” Subramanian wrote in her note, adding that there are good and bad ways “to resolve this seemingly untenable situation.”A structural or temporary shift?This feverish pricing has left many market participants wondering if these levels signal the approach of a bubble or reflect profound changes within the composition and business models of the index.“Perhaps this situation is not untenable,” Subramanian writes, noting the index has evolved considerably since earlier decades. She returned to a thesis about the modern version being markedly more asset- and labor-light, with technology, communications, and health care making up a significant portion. Companies are less levered and more predictable, with 80% of S&P 500 debt now fixed and long-term, compared with just 44% in 2007. “Perhaps we should anchor to today’s multiples as the new normal rather than expecting mean reversion to a bygone era.”Subramanian toldFortunein August that a boost in worker productivity may finally be kick-starting a revolution in equities, and it has to do with this asset-light structure. To that point, the cheat sheet a month later argues that frothy valuations could be justified if an earnings boom materializes, helping the index “grow into” its multiples. History shows that price/earnings ratios can compress in two ways: Either stock prices fall or corporate profits rise. With broadening profitability, innovations in automation and AI, and persistent fiscal support across major economies, an earnings surge in 2025 and beyond is not out of the question. Should profits outpace expectations, the current valuations could be justified, softening the risks of a sharp reversal. Still, according to Subramanian, there is a “valuation problem” in equities right now.For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing. Join us at the Fortune Workplace Innovation SummitMay 19–20, 2026, in Atlanta. The next era of workplace innovation is here—and the old playbook is being rewritten. At this exclusive, high-energy event, the world’s most innovative leaders will convene to explore how AI, humanity, and strategy converge to redefine, again, the future of work. Register now.
Gold futures just rose above $4,000 per ounce for the first time ever
Gold futures rose above $4,000 per ounce for the first time as investors continue to seek a safe haven for their money with the U.S. government essentially shut down.Recommended VideoAs of 9:10 a.m. ET, gold futures traded at $4,003 in New York. The going price for New York spot gold rose to $3,960.60 per troy ounce — the standard for measuring precious metals.Gold sales can rise sharply when anxious investors seek secure investments for their money. Before Tuesday, the asset — and other metals, like silver — had seen wider gains over the last year, particularly with President Donald Trump ’s barrage of tariffs plunging much of the world into economic uncertainty.Join us at the Fortune Workplace Innovation SummitMay 19–20, 2026, in Atlanta. The next era of workplace innovation is here—and the old playbook is being rewritten. At this exclusive, high-energy event, the world’s most innovative leaders will convene to explore how AI, humanity, and strategy converge to redefine, again, the future of work. Register now.
‘This team is guided by science’: Kenvue chief hits back at Trump and RFK Jr.’s Tylenol autism claims in memo to 20,000 employees
Kenvue’s interim CEO is defending Tylenol’s safety after President Donald J. Trump and Health Secretary Robert F. Kennedy Jr. linked the pain reliever to autism and crashed the company’s shares.Recommended VideoIn a memo shared with around 20,000 employees, Kenvue Interim CEO and Director Kirk Perry stressed that many credible public health and medical professionals maintain that Tylenol is safe for women to take during pregnancy.Here is the full memo, which Perry also shared on LinkedIn:Kenveuers,As this week comes to a close, I want to thank you, again, for the resilience you’ve shown.Difficult as it has been, it is clear to me that this team is guided by science and passionate about caring for others. What has been so encouraging this week is the groundswell of independent, credible public health and medical professionals from all around the world who shared their voices – everyone from the World Health Organization to local family doctors.That’s because acetaminophen is the safest pain reliever option for pregnant women as needed throughout their entire pregnancy.I want to reassure you that we will continue to live our Value to Earn Trust with Science – because it’s the right thing to do and nothing matters more to us than the health and safety of people using our products.We have over a decade of rigorous research, endorsed by leading medical professionals and global health regulators, confirming there is no credible evidence linking acetaminophen to autism. The Tylenol brand has been trusted for generations and will be trusted for generations to come.I firmly believe that moments like these are when you see true character and I’ve been incredibly proud of how each of you has shown up. Thank you for working to bring science to the consumers who need our products.Our Purpose is more than words on a page, and I am counting on you all to stay focused on realizing the extraordinary power of everyday care.With gratitude,KirkTrump and RFK Jr. have heavily promoted an unproven claim that acetaminophen/Tylenol use in pregnancy contributes to autism, with Trump saying the FDA would caution against Tylenol for pregnant people and touting leucovorin as an autism treatment, while RFK Jr. has previewed a report linking prenatal Tylenol to autism and endorsing folinic acid therapy; leading medical groups and experts responded that high‑quality studies do not show a causal link and that acetaminophen remains an appropriate option in pregnancy.Shares declineShares of Tylenol parent company Tylenol have declined 22% in the past month amid the speculation.In a statement toFortune, Kenvue said it is “deeply concerned” about the confusion resulting from recent announcements.“We believe independent, sound science clearly shows that taking acetaminophen does not cause autism,” a spokesperson toldFortunein an emailed statement. “We strongly disagree with any suggestion otherwise and are deeply concerned about the health risks and confusion this poses for expecting mothers and parents.”“Acetaminophen is the safest pain reliever option for pregnant women as needed throughout their entire pregnancy,” the company continued. “Without it, women face dangerous choices: suffer through conditions like fever that are potentially harmful to both mom and baby or use riskier alternatives. High fevers and pain are widely recognized as potential risks to a pregnancy if left untreated.”While lawsuits alleging a connection have previously failed in federal courts due to insufficient scientific evidence, analysts say future government announcements or heightened public concern could affect consumer behavior and sales,Fortune‘s Sasha Rogelberg reported last month. However, experts believe proving a legal or scientific case remains challenging, and Kenvue’s actual acetaminophen sales have so far shown resilience despite both litigation and headlines surrounding the autism claimJoin us at the Fortune Workplace Innovation SummitMay 19–20, 2026, in Atlanta. The next era of workplace innovation is here—and the old playbook is being rewritten. At this exclusive, high-energy event, the world’s most innovative leaders will convene to explore how AI, humanity, and strategy converge to redefine, again, the future of work. Register now.