Wall Street experts discuss the opportunity for stocks to finish strong by the end of 2023. Although the market is currently having quite a rough month, some strategists are still optimistic regarding the return opportunities for investors. Traders are believed to find benefits not only this year but also beyond.
The stock market is seeing its 2nd worst month throughout the entire 2023. According to LSEG data, the MSCI world indexes aggregate dropped by 2.96%. The situation was triggered by growing risk sentiments and expectations of the interest rate staying higher for a longer period. Additionally, the market was influenced by increasing concerns over China’s second-largest economy in the world.
As a result, traders experienced a tepid start in September. Nevertheless, some Wall Street strategists believe stocks can finish strong in 2023. What’s more, some say market participants can benefit from better entry points for bonds in the face of the FED’s hiking and currently higher interest rates.
One thing all experts agree on is that work to bring down inflation is not done, though the hiking cycle paused this month. People no longer discuss if the FED moves to high rates (everyone is sure it will). The main question is for how long it is going to be held at an elevated level.
Goldman Sachs does not see a recession despite the fact the majority of market participants expect it to happen in 2024. The possibility is estimated to be 15%, which is lower than previous predictions by the bank. In simpler words, we might see a soft landing.
JPMorgan Private Bank also sees no recession though we still have some crucial pain points featuring fixed mortgage rates hitting their highest high in the last 22 years. On the one hand, we will see a slowdown in economic activity. However, it will take place gradually instead of having a sudden halt.
What markets are seeing right now is decreasing worries about near terms. Last year’s main fears of economic slowdown and inflation are also fading. Demand is quite durable, especially for tech stocks. AI-based companies have skyrocketed while businesses keep ramping up investments.
So, the tech sector can be the main one to look for shortly.
May the trading luck be with you!