The major stock indices remained relatively stagnant compared to last week, with noticeable further declines. It’s a lackluster beginning to the week, setting the stage for another period of market losses that are wearing down investors and causing hesitation.
“Approaching the end of December, investors are eagerly anticipating the Santa Claus Rally, but stocks have experienced consecutive weeks of decline for the first time since September,” remarked Chris Larkin, who is the managing director of trading at E*Trade within Morgan Stanley. “While a temporary boost was seen with cooling inflation data, the Fed’s firm stance on potentially maintaining high rates for an extended period has likely subdued some investors.”
“Although rates and inflation might have reached their peak, we view this as a harbinger of reduced profitability, a reality that we believe is not being fully acknowledged but cannot be disregarded any longer,” stated Michael Wilson, an equity analyst at Morgan Stanley, in a message to investors.
? JP Morgan 2023 Outlook?
?? Equity valuations are approaching the long-term average, but there are no significant bargains. pic.twitter.com/ILtXrmqviS
— Disruptor ⚡️ (@DisruptorStocks) December 19, 2022
Notably, affluent millionaire investors are anticipating substantial declines well into 2023 and are maintaining a pessimistic stance as a consequence.
“This group hasn’t exhibited such a high level of pessimism since the 2008 and 2009 financial crisis,” noted George Walper, who serves as the president of Spectrem Group.
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