Fisher Investments is a well-known global investment adviser founded by renowned investor Ken Fisher. Recently, Fisher expressed an optimistic outlook on the stock market in 2023 despite market volatility and global economic uncertainty. His positive view is based on strong corporate earnings growth and healthy consumer balance sheets in developed countries.
U.S. economy likely avoiding recession
Fisher believes the risk of a U.S. recession in 2023 is overblown. While economic growth is slowing, consumer spending remains resilient thanks to excess savings and a strong job market. This supports corporate earnings even amidst rising rates and inflation.
Valuations becoming more reasonable
After the significant market decline in 2022, stock valuations have moderated and are approaching historical averages. For example, the S&P 500 forward P/E ratio has fallen from over 21x to around 17x currently. This improves the risk-reward profile of equities going forward.
Weaker dollar providing tailwind
The U.S. dollar index has declined about 7% from its peak in September 2022. A weaker dollar benefits U.S. multinational companies by increasing the value of overseas sales. It also boosts foreign investment into U.S. stocks.
Technical indicators signaling opportunity
From a technical perspective, the S&P 500 index is reaching long-term support levels and deeply oversold conditions that often mark tradable market bottoms. This suggests upside potential even if fundamentals continue to weaken somewhat.
Fisher Investments believes the odds of a new bull market in stocks are growing due to moderating valuations, still positive economic backdrop in the U.S., and supportive technical factors. While risks remain, Fisher’s outlook is more optimistic than the consensus view.