GS Kaplan A few observations from today

GS Kaplan - A few observations from today 14 Oct 2026 Matthew Kaplan · Goldman Sachs · Vice President, U.S. Shares Sales Trading, FICC & Equities 14 Oct 2026

Today felt like a confluence of factors all coming to a head:

1. Fed commentary had been mixed heading into CPI, and the market was underpricing the likelihood of more hikes being priced in through '27 (Dec hike odds settled at ~88% on the day)

2. AI funding concerns (i.e. where we are in the equity capital market cycle) and a growing focus on credit markets/funding conditions for the Neoclouds (CRWV questions were high)

3. Real concerns over the AI/Semis backdrop and the lack of EPS driven relief in the space (ASML finished -3.94% in NY, will you be rewarded for earnings beats this quarter?). As a reminder, positioning within Mag7 has crept notably higher over the past few weeks (3m implied vols for Mag7 look low here).

4. Stagflationary pressures continuing to build, with our Stagflation Pair (GSPUSTAG) having a top move YTD

On our desk, investor activity was underwhelming. However, based on our conversations, investor anxiety is high. Our info tech sell skew hit the highest in > 4 weeks (driven by LO supply + HF long & short supply).

Looking at factor / basket vol, only 1 of our flagship baskets had a >3 std dev move (Low Quality/Junk finished down 4.5%; reminder our Quality Pair is now up 13.6% over the last 1 month), a good reminder that while index vol has been muted, factors/thematics have been on the move.

Semis Red Streak Continues (6 consecutive down sessions are uncommon)

GS GBM, as of 10/14/2026. Past performance is not indicative of future results.

Mag7 Implied Vol is near multi-year lows. In other words, the cost to hedge these names through earnings and Year End is NOT high enough. (h/t Cullen Morgan)