Investors should brace for more volatility in 2023

One of the biggest surprises of 2022 for me was how resilient stocks have been in the face of seemingly relentless tightening of monetary policy by major central banks, and the negative impact that is bound to eventually have on the global economy.

On Dec 13, the day before the US Federal Open Market Committee (FOMC) announced its latest interest rate hike, the S&P 500 index actually closed above the 4,000 level – at 4,019.65, which was only 15.7 per cent below where it began the year.

The S&P 500 had spent significant periods of the year below the 4,000 threshold, of course. But analysts and investors did not seem to lose their penchant for “looking through” the monetary tightening to an eventual easing cycle.