News about defensive stocks

Goldman Sachs says investors worried that the AI trade may lose momentum should look to defensive stocks in health care and consumer staples, especially high-quality names that have recently lagged the market. Analysts led by Ben Snider note that Goldman's cyclicals-vs-defensives pair has fallen 6% over the past two weeks, and that AI capital spending now contributes about half of S&P 500 earnings growth, a share expected to shrink as spending slows. Among the stocks on Goldman's screen, Tyson Foods has an 11% trailing four-quarter free cash flow yield, the highest on the list, though its shares are down nearly 17% over six months. CVS Health has a 9% free cash flow yield and is up 15% this year but down 15% over the past three months. Goldman's base case still calls for continued earnings growth, and it sees possible catch-up gains in beaten-down consumer stocks in 2027, supported by lower energy prices and falling interest rates.