Aggressive interest rate hikes by the Fed to curb sky-high inflation resulted in massive volatility in the market last year, thereby affecting investors’ confidence. However, with the better-than-expected inflation numbers in October and November, investor sentiment improved alongside hopes of the Fed lowering the size of rate hikes.
In addition, Dubravko Lakos-Bujas, Global Head of Equity Macro Research J.P. Morgan, predicted that while the first half of the year would witness the Fed’s tightening, several factors should signal a pivot, subsequently driving an asset recovery and pushing the S&P 500 to 4,200 by year-end 2023.
