December 2022 had most, if not all, analysts, strategists, and houses calling for a bleak first-half of 2023. And, as we are only one month in, they may yet prove to be right. Having said that, often, a unanimous and unambivalent chorus leads to the opposite reality.

That does seem to be the case for now: if all market participants are bearish and have sold, then, on margin, there is no new player coming in to sell and ergo, prices go up. As a result, we have not been surprised by the direction of the price action even though the pace has been quicker than expected.

We have reiterated over the last few months the possibility of a disconnect between pessimistic headlines and soundbites of job losses and slower economic momentum / data coupled with rising asset prices. This seeming anomaly, again, can be easily explained. The twelve months of 2022 had every conceivable problem thrown at investors.