Last week, Wall Street wrapped up its worst year since 2008. Simply put, 2022 was brutal. All three of the major averages snapped a three-year win streak - the Dow Jones was down about 8.8%, the S&P 500 sank 19.4% and the Nasdaq tumbled 33.1%. High inflation and aggressive interest rate hikes from the Federal Reserve battered stocks and investor confidence. Concerns over war in Ukraine and fears of economic recession kept financial markets on edge. As the calendar turns to a new year, many investors still think the pain is far from over. They expect the bear market to persist until a recession hits or the Fed stops raising interest rates. Some Wall Street analysts are projecting that stocks will hit new lows before rebounding in the second half of 2023.
Economic reports from last week came back mixed: •Single-Family Home Values - higher than expectation •Manufacturing (Dallas) - lower than expectation •Manufacturing (Richmond) - lower than expectation •Pending Home Sales - higher than expectation •Jobless Claims - higher than expectation In a holiday-shortened week, investors will look for guidance from economic reports like Construction Spending, Vehicle Sales, Job Openings, Employment and Jobless Claims.