2022 was a pretty rough year for investors, mostly all over the world. Especially here in the US. The markets were shook and taken down by Fed’s aggressive rate hikes to which the markets reacted in the most natural way possible.

The S&P tanked nearly about 20%, while the tech heavy Nasdaq crumbled down by a massive 35%. Even the Santa Rally didn’t workout this time. This was one of the worst performances ever in the history of stock markets.

The road to recovery in 2023 may not be an easy one, but it doesn’t seem impossible, even though the Fed is trying to tame down inflation by hiking interest rates, they are showing their intended effect, as it could be seen in the December Jobs report. The markets have taken a pretty big hit and they have gotten off to a slow start in 2023, but history suggests that markets have pretty much outperformed themselves after a terrible year, with gains ranging from anywhere between 17-50% for the next three years after a poor year. Big corporations are struggling because of the Macroeconomic headwinds they are navigating through right now and issues with the supply chain, strengthening dollar are also making it hard for them to keep up with their previous performances or even meet the expectations from Wall Street.

No one can actually predict how a stock market is going to perform in a year, even the top analysts could get it wrong, like they did last year. But history has proven time to time, that markets do recover and when they do, they make the red days worthwhile.