December 28, 2022

Markets:

Stock futures climbed fractionally Wednesday morning as traders look to the end of a losing year and prepare for 2023.

Investors will look for insights into the state of the economy in manufacturing data from the Richmond Federal Reserve and pending home sales coming Wednesday morning. Market participants will be looking for numbers that can signal the economy is cooling, which they hope could indicate to the Fed that interest rate hikes can continue slowing.

With three trading days left in 2022, the stock market is on track for its worst year since 2008. The Nasdaq has performed the worst of the three indexes, losing 33.8% this year as investors rotated out of growth stocks amid rising recession fears. The Dow and S&P 500 are on track to lose 8.5% and 19.7%, respectively.

European markets were mixed on Wednesday as investors look ahead to the various economic headwinds coming down the pike in 2023.

Portfolio:

We enter the new trading session holding positions in PDSB, AAL, and ZIM. Markets remain in the trend range we continue to pinpoint (3800 – 3900 on the s&p). Until it breaks, either side of the trade, it's difficult to have strong conviction either way. Just keep in mind that the market is forward thinking vehicle, typically 12 to 18 months ahead. So many bearish calls, I wouldn't be surprised one bit if 2023 ends up being a monster year for the markets. Especially leading into 2024 elections – which typically is a bullish trend for traders. Right now, focus on the trend lines we isolated. At this point, would be surprised to see a break and hold prior to the end of year. We could sit right here for the next three sessions and wait for the New Year to begin with all traders and investors back from holiday break. Just remain patient. 2023 is setting up for a monster trend year.