2024 - Predictions (Financials)

[winston]

Wall Street's 2023 outlook for stocks

by Sam Ro

The average forecast predicts the S&P 500 climbing by about 10%, which is in line with historical averages.

This time around, the pros are unusually cautious with most expecting the S&P to end 2023 lower than where it is today.

Most Wall Street firms expect the U.S. economy to go into recession some time in 2023.

Many believe forecasts for 2023 earnings have more room to get cut, and some believe those downward revisions mean lots of volatility for stocks in the early part of 2023.

At the same time, many also expect an unambiguous drop in inflation, which would give the Federal Reserve the clearance to ease up on its hawkish monetary policy stance.

At least some strategists think if economic conditions deteriorate significantly, the Fed may even return to cutting interest rates.

Strategists expect a volatile first half to be followed by an easier second half.

Source: Yahoo Finance

https://finance.yahoo.com/news/wall-str ... 55543.html

[winston]

Fitch Axes 2023E Global Econ Growth to 1.4%, CN Growth to 4.1%

Fitch issued global economic outlook. It lowered global economic growth forecast for next year to 1.4% from 1.7%, since central banks intensified their fight against inflation, coupled with deteriorated outlook for China's property market.

Fitch cut China's growth forecast for next year to 4.1% from 4.5%, owing to downbeat real estate recovery outlook.

China's 2022 growth forecast was kept at 2.8%, because the epidemic outbreak exerted pressure on the recent economic activities.

Separately, the rating agency trimmed its US growth forecast for next year to 0.2% from 0.5%.

Source: AAStocks Financial News

http://www.aastocks.com/en/stocks/news/ ... t-news/HK6

[winston]

HSBC Global Foresees US Rates to Reach 4.75-5% Next Yr; End-2023 Target for HSI Set at 22,470

HSBC Global Private Banking forecast that the benchmark interest rate of the U.S. will be lifted to 4.75-5% in 2023 and will remain largely stable throughout the year, commented Fan Cheuk Wan, Chief Investment Officer Asia, Global Private Banking and Wealth at HSBC.

As for Hong Kong equities, the bank forecast that the market will hail an upward momentum throughout 2023, with end-2023 targets for the HSI/ HSCEI/ CSI 300 Index set at 22,470/ 7,830/ 4,600.

Specifically, the bank favored sectors including consumption, casinos, aviation and financials, and remained relatively cautious on Chinese property sector.

Source: AAStocks Financial News

http://www.aastocks.com/en/stocks/news/ ... t-news/HK6

[behappyalways]

Goldman, BofA, JPM CEOs Paint Grim Picture Of US Economy, Market In 2023
https://www.zerohedge.com/markets/goldm ... arket-2023

[winston]

Morgan Stanley economist: Here comes a 'loose' recession

by Brian Sozzi

Looking for further slowdowns in consumer spending and the housing market in the United States.

At the same time, he said, growth in Europe and China will be mixed at best.

Projecting global GDP growth to clock in at a meager 2.2% in 2023, with U.S. GDP growing by a mere 0.5%, the eurozone seeing a 0.2% decline, and China potentially growing by 5% as its economy reopens from strict COVID-19 protocols.

Citi expects the eurozone and U.K. to enter a recession by the end of this year. According to Chief Economist Nathan Sheets, the U.S. stands to enter a recession by mid-2023 as the full impact of higher interest rates from the Federal Reserve is felt by consumers and businesses.

BNP: "We expect a downturn in global GDP growth in 2023, led by recessions in both the U.S. and the eurozone, with below-trend growth in China and many emerging markets," the BNP strategy team said in a note of its own this month.

Source: Yahoo Finance

https://finance.yahoo.com/news/morgan-s ... 49933.html

[winston]

S&P Global predicts a challenging 2023 around the world

by Surin Murugiah

Challenge of getting inflation under control without damaging output.

The key factor to watch will be labour markets, adding that while employment growth is slowing, the resilience of labour markets may encourage central bankers to continue pursuing tighter monetary policy.

Emerging markets follow a global trend of surprising strength this year but would face slower or non-existent growth in 2023 and potentially beyond.

Source: theedgemarkets.com

https://www.theedgemarkets.com/article/ ... ound-world

[winston]

BlackRock Warns to Prepare for Recession ‘Unlike Any Other’

By Jack Phillips

BlackRock—a controversial investment fund that has pushed for ESG—say that the worldwide economy has entered a phase of higher volatility and that a recession is likely imminent after central banks such as the U.S. Federal Reserve have raised interest rates to curb decades-high inflation.

Deep recession may be the only way to tame inflation, which in the U.S., reached over 9 percent year-over-year in June 2022.

“We expect inflation to cool but stay persistently higher than central bank targets of 2 percent.

Simply ‘buying the dip’ doesn’t apply in this regime of sharper trade-offs and greater macro volatility. We don’t see a return to conditions that will sustain a joint bull market in stocks and bonds of the kind we experienced in the prior decade.

“Corporate earnings expectations have yet to fully reflect even a modest recession. This keeps us tactically underweight developed market equities.”

Source: Epoch Times

https://www.theepochtimes.com/blackrock ... 2F4MLXs%3D

[winston]

Bloomberg now expects 2023 to be one of the worst years for the world economy since 1993

by Jing Pan

The world economy will grow 2.4% in 2023, marking a slowdown from the 3.2% growth expected for this year.

2.4% would be the slowest growth since 1993 — except for the crisis years of 2009 and 2020.

His analysis also shows the U.S. economy entering a recession at the end of 2023.

For the euro area, a recession is expected at the start of the year.

The Fed is headed toward a terminal rate of 5%, and will stay there till 1Q24.

“In the euro area, meanwhile, a more rapid decline in inflation will mean a lower terminal rate and the possibility of cuts at the end of 2023.”

Source: Money Wise

https://finance.yahoo.com/news/bloomber ... 00187.html

[winston]

Michael Darda of MKM Partners carefully couched his S&P target comments

‌"Back in 2020, the S&P 500 bottomed at about 18x five-year forward estimates, which would be about 3300 or so, roughly a 14% fall from where the S&P 500 closed last week," Darda wrote.

"Although this is simply a rough starting assumption (it could be worse and also could be better if we are wrong about a recession next year) keep in mind that in the event of a downturn, markets usually bottom out about two-thirds of the way through the recession (or four-to-five months before a recovery begins)."

When asked why he avoids a specific target, Darda quoted famous economist John Maynard Keynes: "Better to be roughly right than precisely wrong."

Source: Yahoo Finance

[winston]

Baird’s Michael Antonelli also declined to offer an S&P 500 price target while sharing some of his 2023 projections, including his view that the Federal Reserve's next interest rate increase will be its last of this cycle.

"What you really want to dig into when it comes to a strategist's view is how adaptable they are to change," Antonelli said in a follow-up message.

"Do they stick with a bullish or bearish view as the year unfolds?

The best ones are open to changing their minds or admitting being wrong."

Source: Yahoo Finance

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