
Please try another search
What a difference a rally makes. So far this year, the S&P 500 is up more than 6%. Not bad considering the doom and gloom from Wall Street forecasters at the end of 2022. Recall how strategists in early December were projecting large-cap U.S. stocks to finish 2023 in the red. Naturally, the market did the opposite of what most experts were thinking.
Stocks soared to jumpstart the new year. Many regions notched their best January in decades. What’s more, even the left-for-dead 60% stock-40% bond portfolio is off to its hottest beginning to a year since 1991. Put simply: The pundits have been totally wrong—at least based on the first six weeks of 2023.
Does flipping the page from December to January really make a difference?
Common sense says no. Still, it’s hard to ignore one fascinating trend: The lousiest assets last year are 2023’s treasures. Goldman Sachs put out a jaw-dropping visual on this quirky relationship. Perhaps the downward pressure on share prices caused by December’s tax-loss selling, coupled with January’s drop in interest rates, set us up for this year’s gains.
Source: Goldman Sachs
The consensus among strategists also called for a first-half recession before a late-year economic recovery. Even that outlook has flipped in just a few weeks. There’s emerging chatter that the U.S. will skirt a recession. January’s jobs report was stellar, while inflation readings since the start of the year have been quite sanguine. We’ll get another read on inflation in Tuesday’s Consumer Price Index report for January.
Animal spirits are slowly re-emerging. Investors are more upbeat about where things stand, while economists and strategists are walking back their bearish calls made just a handful of weeks ago. It’s yet another instance that underscores the value of ignoring the experts—and sticking with your long-term investment plan.
***
Disclaimer: This article was first published on The Humble Dollar
June is expected to be another volatile month on Wall Street amid a trio of significant market-moving events. Market's focus will be on the U.S. jobs report, CPI inflation data,...
The warning signs continue to mount. Yet the US economy continues to defy expectations in some quarters that a recession is near. Granted, it’s arguably a precarious expansion...
Fractional Reserve banking allows for economic growth but does have its risks. Heightened surveillance and traceability of CBDC are highly concerning. But, CBDC gives the Fed even...
Are you sure you want to block %USER_NAME%?
By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.
%USER_NAME% was successfully added to your Block List
Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.
I feel that this comment is:
Thank You!
Your report has been sent to our moderators for review
Add a Comment
We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:
Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.