Equity investors hoping for a better year in 2023 will be disappointed, according to Goldman Sachs Group Inc. strategists, who said the bear market phase is not over yet.
“The conditions that are typically consistent with an equity trough have not yet been reached,” strategists including Peter Oppenheimer and Sharon Bell wrote in a note on Monday. They said that a peak in interest rates and lower valuations reflecting the recession are necessary before any sustained stock-market recovery can happen.
The strategists estimate the S&P 500 will end 2023 at 4,000 index points -- just 0.9% higher than Friday’s close -- while Europe’s benchmark Stoxx Europe 600 will finish next year about 4% higher at 450 index points. Barclays Plc strategists led by Emmanuel Cau have the same target for the European gauge and said the path to get there will be “tricky.”