Following a nearly 20% decline for the S&P 500 in 2022, its worst annual performance since 2008, the index rose 24% in 2023. Rather than ramble on about the folly of trying to predict these short-term price swings, this quote from a yearend 2022 New York Times article does a great job of succinctly demonstrating the recent track record for Wall Street’s market predictions:

“A year ago, bank analysts responsible for projecting where stocks would end 2022 were somewhat optimistic… Even the most pessimistic prediction at that time thought that the S&P 500 would finish the year 10% higher than where it actually will. Now, the most optimistic strategist doesn’t expect the S&P 500 to even make up that lost ground in 2023, while most expect the market to end roughly at where it’s starting, after a dip early in the year.”

With the benefit of hindsight, the most pessimistic strategist wasn’t pessimistic enough in 2022, and the most optimistic strategist wasn’t optimistic enough in 2023 - an impressively bad overall result for the group. (As an aside, I personally prefer the term “soothsayer”, defined as “a person who predicts the future by magical, intuitive, or more rational means”. On the range from magical to more rational means, I’ll leave it to you to determine what the strategists’ stock market predictions are likely to be based upon.)