![[Gamma] Scalping Please](https://ibkrcampus.com/wp-content/smush-webp/2024/04/tir-featured-8-700x394.jpg.webp "[Gamma] Scalping Please")
What’s going on?
Here’s hoping those novelty 2023 glasses have prescription lenses: let’s take a look at what investors might be in for next year.
What does this mean?
You can be anything you want to be next year, but maybe be patient. See, the S&P 500 and Stoxx 600 – the key US and European stock indexes – dipped 21% and 13% respectively this year, and teetering economies could mean there’s more to come. Goldman Sachs and Morgan Stanley analysts agree, predicting that interest rate hikes and weak economic growth will curb company earnings and, in turn, stock prices during the first half of the year. But chin up: economists are predicting a rosier-by-comparison 2024, meaning forward-looking markets should bottom sometime next year – probably when central banks stop hiking. So not only could you snap up a few bargains when that happens, but strategists expect a rebound in the second half of the year to pull those two stock indexes around 7% and 5% higher than they are today.
Why should I care?
For markets: Not-so-general consensus.
Now, those are average estimates – in reality, analysts’ expectations for the S&P 500 range from a 24% giddy-up to an 11% drop. But history shows that US stocks rarely slip two years in a row (like, a “four times in a hundred years” type of rare), so the odds look promising. But when they have, the second drop has always been worse than the first – a painful 24% on average. So while history says next year is likely to be better, another dip could leave investors nursing another shiner of a bruise.
The bigger picture: The winner is…
If big banks made Christmas cards, Goldman Sachs’s would say, “love your commodities”. The investing titan believes the asset class will ride out a bumpy first few months of 2023, before boasting pumped-up prices due to scarce supply of raw materials. In fact, Goldman predicts commodities will take the best-performing-asset-class medal yet again next year, and says a key commodity index will rise a mouth-watering 43%.
—
Originally Posted December 29, 2022 – Foresight’s 20/23
Disclosure: Interactive Brokers
Information posted on IBKR Campus that is provided by third-parties does NOT constitute a recommendation that you should contract for the services of that third party. Third-party participants who contribute to IBKR Campus are independent of Interactive Brokers and Interactive Brokers does not make any representations or warranties concerning the services offered, their past or future performance, or the accuracy of the information provided by the third party. Past performance is no guarantee of future results.
This material is from Finimize and is being posted with its permission. The views expressed in this material are solely those of the author and/or Finimize and Interactive Brokers is not endorsing or recommending any investment or trading discussed in the material. This material is not and should not be construed as an offer to buy or sell any security. It should not be construed as research or investment advice or a recommendation to buy, sell or hold any security or commodity. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.
Disclosure: Futures Trading
Futures are not suitable for all investors. The amount you may lose may be greater than your initial investment. Before trading futures, please read the CFTC Risk Disclosure. A copy and additional information are available at ibkr.com.
