It’s too early to bid farewell to the decade-long equity bull market as stocks are still providing healthy returns for investors, according to Goldman Sachs Group Inc.

“Even with low profit growth the corporate sector has a high free-cash-flow yield and the dividend yield (plus buybacks) ought to still provide a reasonable relative return,” Peter Oppenheimer, Goldman’s chief global equity strategist, wrote in a note on Monday.

The bank’s call comes after Citigroup Inc. last week anticipated a continuation in the strong run of equities and JPMorgan Chase & Co. analysts said in an Oct. 4 note that the current market correction will be less painful than last December’s rout.

The stock market’s powerful rally was put to test last week when equities worldwide slumped after weak economic data in the U.S. and Europe fueled concerns about global growth stalling. Investor sentiment didn’t improve today after Bloomberg News reported that Chinese officials are indicating they’re increasingly reluctant to agree to a broad trade deal sought by U.S. President Donald Trump.

A range of indicators including investor positioning before the most recent stock sell-off suggests that the drawdown in the market is about half-finished, according to JPMorgan analysts.

“Entering October, vulnerabilities were moderate rather than high,” John Normand, head of cross-asset fundamental strategy at JPMorgan, wrote in the note.

Traders are also questioning what kind of shares will lead the market in the new environment after September fueled a rare outperformance in so-called cyclical stocks that are more sensitive to the economy. Goldman reiterated its call from last month that the switch away from defensive sectors won’t last and said economic growth would need to improve and bond yields to rise for the rally’s structure to change.

The outperformance of quality and growth shares will continue to support the U.S. stock market, according to Goldman, which has a higher weighting of tech and other industries associated with earnings growth relative to Europe.

“The bull market will end when the world economy enters a full-blown recession,” said Andrew Milligan, head of global strategy at Aberdeen Standard Investments. “Equity gains during the rest of the year could appear if we get more positive news about the trade tensions, about the efficacy of monetary and fiscal policy in reviving growth, and if expectations for profits suggest even modest growth.”

--With assistance from Christopher Anstey and Namitha Jagadeesh.

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