MarketBeat Minute(2022-12-30)

Equity markets rebounded strongly on Thursday but investors should not read too much into the move. The gains were driven by holiday trading and not any news or change to the fundamental outlook. As good as the near 2.0% gain is for the S&P 500, it left the index far short of key levels needed to signal truly bullish behavior.

The outlook for 2023 is as mixed as it has ever been. While the economic data continues to show underlying strength, the rise of inflation and FOMC interest rates remains a shadow that will weight on sentiment for the foreseeable future. If the market's fears are realized and there is a deep recession the S&P 500 will likely move much lower before the end of 2023.