Goldman Sachs: Retail trading activity in US stocks drops 45% from late last year, stock supply may hit a 26-year high in 2027

October 27 - Goldman Sachs data shows that U.S. retail stock trading activity has dropped about 45% compared to the end of 2025, with retail trading's share of total U.S. equity volume falling from 15% at the end of last year to about 9%, near the lowest level since 2020. Goldman Sachs believes that rising energy prices, weak consumer confidence, and higher U.S. Treasury yields are dampening retail buying willingness.

Despite cooling short-term trading enthusiasm, U.S. households still net purchased about $840 billion in U.S. stocks in the first half of the year, and stock mutual funds and ETFs have attracted about $350 billion in inflows so far this year. However, household equity assets are highly concentrated, with the wealthiest 10% of households holding about 87% of household equity assets.

Goldman Sachs also warned that the U.S. stock market is facing supply pressure. In the first half of 2026, U.S. listed and unlisted companies collectively issued about $175 billion in net equity, and the bank expects that due to new share offerings and lock-up expirations, the net supply increase in the U.S. public equity market in 2027 could reach the highest level since 2000.

With hedge funds reducing positions and corporate equity supply increasing, Goldman Sachs believes that whether U.S. households can continue buying stocks will be key to whether the market can absorb the new supply. The bank's baseline forecast suggests that if the job market remains stable and bond yields decline moderately, household equity demand is still expected to remain solid.