Goldman Sachs Group said that consumer spending cuts are affecting corporate earnings, which poses a greater risk for the US stock market than for US households to sell stocks, the Zhitong Financial APP has learned.

Goldman Sachs Group strategist David Kostin believes that high inflation and asset depreciation have begun to strain household finances, with retail sales falling 0.3% in May and Michigan's consumer sentiment index hitting a record low in June. Retailers such as Target Corp (TGT.US) and Walmart Inc (WMT.US) seem to overestimate consumer demand in some general commodity categories and are now offering discounts to clear excess inventory, and falling consumer spending threatens the earnings of consumer stocks. The average price of used cars in the United States has fallen by 6% since January, indicating that overall demand for cars is also falling.

Goldman Sachs Group expects the S & P to reach 4300 by the end of the year, with some strategists targeting a median of 4650 as of mid-June. However, the index, which closed at 3911.74 on Friday, has fallen about 18 per cent this year.Kostin believes that some investors are worried that higher cost of living, rising bond yields and weak stock returns may make households more "deterred" from investing in the stock market.

It is worth mentioning that although most of the shares are generally held by the rich, who are more sensitive to the impact of inflation, companies tend to buy when households sell shares. It is understood that the s & p 500 has risen by an average of 8% since 1950, when households sold stocks most aggressively.