The S&P 500 has shed 17% year-to-date as concerns about recession, the Federal Reserve’s aggressive interest rate hikes, and Russia’s invasion of Ukraine rattled investors’ confidence.
Wilson believes the index will finish 2023 trading close to its current level of around 3,900. But the strategist noted that end-of-year targets for indexes now mean little to investors, given the high level of volatility in markets.
“Nobody cares about what’s going to happen in 12 months — they need to deal with the next three to six months,” he said. “That’s where we actually think there’s a significant downside.”
“So, while 3,900 sounds like a really boring six months — no, this is going to be challenging. It’s going to be a wild ride.”
Lower earnings could cause significant pain for larger-cap stocks, Wilson said.
