Goldman Probes May Lead Global Stocks Lower, AMP Says

Widening probes of Goldman Sachs Group Inc. may prompt a drop of as much as 10 percent in global stock markets, according to AMP Capital Investors Ltd., a unit of Australia’s biggest provider of pension plans.

The MSCI World Index, as well as U.S. and Asian equity gauges, are ripe for a “multi-month” correction after valuations soared, said Nader Naeimi, a strategist who helps oversee $90 billion for the Sydney-based mutual-funds manager. AMP Capital last week began moving to cash assets from equities, anticipating a decline in stocks, Naeimi said. The MSCI World, which measures 23 developed markets, has rallied 43 percent in the past 12 months. (more)