Here is a good example of how Wall Street really operates.
Heading into March, and also during the peak of the Corona-crisis, Goldman's European strategists headed by Christian Mueller-Glissman, were rather fearful and while they never advised their clients to sell ahead of the crash (which would have been useful), or during it, they certainly never told clients to buy and instead kept a Neutral rating - as in do nothing - on European stocks (amid a broader Underweight weighing of Equities as a class) as the following snapshot from a May 1 report demonstrates.
What happened then, however, is that following the biggest plunge in Europen stocks since the financial crisis, which again Goldman failed to warn against, the STOXX posted the biggest 3-month surge since early 2015 and the 2nd biggest since the financial crisis.
Fast forward to today when the torrid Stoxx 600 rally since the March lows has already fizzled, and what does Goldman do? Why only now, when most of the upside is already gone, the bank moves to Overweight Europe's Stoxx 600, while raising overall stocks from Underweight to Neutral:
We upgrade equities from UW to N for 3m - our equity strategy teams upgraded 3m targets across markets and see less downside (albeit only modest upside). We are neutral across regions for 12m but shift OW Europe for 3m (from N), supported by a pick-up in global growth, US political headwinds and EU policy tailwinds.
And now that Goldman's clients are officially advised to buy the stocks that Goldman's prop desk had been accumulating for the past 3 months, Goldman is starting to sell: take a wild guess what happens to European stocks next.
We will check back in 3 months to see just how much lower they are.