It's been a bleak year for the stock market, which despite some short-term rallies, is still firmly entrenched in bare market territory.

So where do we go from here?

A source of great uncertainty is around the path of inflation and that is also going to carry

over into the path of the equity market. I'm Allison Nathan and this is exchanges at Goldman Sachs. Thanks. is behind the equity market volatility and the road ahead I'm sitting down with

David Kosten chief US equity strategies for Goldman Sachs research David welcome

back to the program. Thanks Allison nice to be here. So let's start with this roller coaster ride

that we've been on with US stocks this year.

The S&P 500 has been down as much as 25% peak to trough.

We're now bouncing around the lower edge of that range but one day

we're in a rally the next day we're in a sell-off give us some context on what

we're seeing and what's driving these moves. My belief is that it is inflation

and the expectations on federal reserve policy

that have been the key drivers of the equity market.

So it's really been a macro-driven market to use that

terminology as compared with more micro-developments at the company level. Of

course the micro-developments matter for individual stocks, but at the overall

index level it's been shifting perceptions

on whether inflation is going to be coming a little bit lower or whether it's

actually remaining high and therefore by extension will the Federal Reserve have to lean in

harder in terms of raising rates more aggressively or whether there'll be

the proverbial pivot and they'll be able to move towards a shallower trajectory of

interest rate hikes. Now to be be fair, the Goldman Sachs expectation

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