After a brutal 2022, investors were delighted in 2023 as markets were driven higher by a stronger-than-expected economy, falling inflation, and light at the end of the tunnel with respect to the Federal Reserve’s interest rate hiking cycle.

2023 stands in sharp contrast with 2022.

Equities soared during the month of November as softer-than-expected US inflation data strengthened investors’ belief that the Federal Reserve (Fed) was done raising interest rates.

Seeking to achieve the long-term equity return of 10% means sitting through all market cycles.

For the quarter, global markets were sent lower by rising interest rates and oil prices.

Economics is not a precise science. Central banks attempt to influence the economy through monetary policy (commonly by raising or lowering interest rates).

US equities rallied despite recession concerns and persistent challenges. In June, stocks entered a new bull market, up more than 20% from the October 2022 low.

After the dramatic events in the banking sector, many investors are worried about a potential recession, and for a good reason.