How to Invest in 2023: Invesco’s Global Market Strategist

Happy Saturday, readers. I’m senior reporter Phil Rosen.

Today’s newsletter features my interview with Brian Levitt, Invesco’s global market strategist.

He breaks down his predictions for the new year and where to put your money as Fed policy begins to change.

After that, I’ve rounded up some of the best stories from a busy week in the markets, just for you.

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Brian Levitt is Invesco’s global market strategist. This discussion has been gently edited for length and clarity.

Phil Rosen: What is your current economic and market outlook?

Brian Levitt: The economy may be going through what we think will be a milder recession, but we expect the market to bounce back in line with what we expect to be a better year for risk assets.

I believe the market has been bearish this cycle. But in the short term, the market may recover some of that. What can happen when the Fed stops with inflation, market prices start a new cycle.

How should investors fare this year?

BL: In the period you may be concerned about the short-term risk, but the challenge for investors, if you try to go down 5-10%, you are at risk of not recovering.

We should try to sit for the next two years for a long-term recovery.

The part of the market that tends to do the best [in this environment] is a higher yielding corporate credit or bond.

And in a recovery, you want to be exposed to cyclical areas of the market, including sectors such as financials, materials and industrials.

What is your prediction for the end of the year in 2023?

BL: Inflation will come down quickly, and while there may be near-term volatility, the market will finish the year well. The S&P 500 will finish the year above 4,000.

Read the 5 biggest takeaways from my interview with Invesco’s Brian Levitt.

What do you think about Levitt’s opinion? Tweet me @philrosennor email me [email protected].

And here are the top stories in the market this week:

1. Drivers may see gas prices rise by nearly $7 a gallon in some US states. Refinery issues could further cut supply and demand from China looks poised to roar back, says GasBuddy: “2023 won’t be a cakewalk for drivers.”

2. Elon Musk’s lawyer subpoenaed the head of Saudi Arabia’s $620 billion fund. The reason? The case of Tesla’s “funding is protected” tweet.

3. At Amazon, there are talks and jokes about Jeff Bezos returning as CEO. The online retail giant is in the midst of mass layoffs and falling stock prices. Here’s what people inside the company are saying.

4. Tesla stock surged in the New Year. The EV maker registered more than 405,000 units in the fourth quarter, well below analysts’ estimates of 430,000 units. By 2022, Tesla’s share price has fallen 69% – wiping out just under $700 billion in market capitalization.

5. Crypto hackers defrauded $3.7 billion last year. TRM Labs’ chief legal officer Ari Redbord told me that 2022 is “the year of the hack.” According to his estimates, North Korean criminal groups have made more than $1 billion in stolen funds.

Written by Phil Rosen in New York. Ideas or tips? tweet @philrosenn or email [email protected]

Posted by Max Adams (@maxradams) in New York.