Summary Stock markets and bond markets have been recovering. The recent market reaction is predicting a soft landing that might mean a mild recession, with inflation ‘under control’. How do you position your portfolio for 2023? tortoon Stock markets are getting comfortable with the soft-landing narrative. For four months the S&P 500 has been recovering. U.S. stocks were up 15% over the period, but softened over the last week. The bond market has also been recovering for several weeks. The stock market recovery is signalling (or guessing) that any economic weakness will not be ‘too bad’. The bond market recovery is suggesting that inflation has peaked, will decline, and that the Fed will cut rates in the not-too-distant future. How to position your portfolio for 2023 – read on. To tame inflation we need to get to a recession, or at least much weaker economic growth or stagnation. A slowing economy should reduce demand and thereby relieve pressure on inflation. The question is just how big a downturn will it take to get inflation under control? Investors are currently suggesting that (at worst) only a mild recession will be required to get the job done. Or course we can’t […]
CamTrader offers a preview only. View original article. seekingalpha.com
