The U.S. stock market today ends the outgoing year with a drop of about 20% , and the index of high-tech companies Nasdaq lost even more, almost 30%), and among analysts of Wall Street prevails a pessimistic view of the next six months, writes Bloomberg.

Senior strategist of Pictet Asset Management Luca Paolini adheres to the negative forecast for the US stock market futures for the next three to six months. In his opinion, the following three factors may lead to the end of the bear market: the restoration of corporate earnings forecasts, an increase in the spread between short-term and long-term bond yields, and a decrease in the ratio of capitalization of companies most sensitive to economic cycles to their expected profits.

CFRA senior investment strategist Sam Stovall also expects a weak start to next year and hopes for a rebound in the second half of the year.

Bloomberg Intelligence (BI) analysts note that when the Fed stops its rate hike cycle, it often causes double-digit gains in stocks. However, the effect could be blurred next year because of high uncertainty and expectations of falling profits for companies in the S&P 500 Index, they believe. The BI model calls for an average 2% decline in earnings per share in 2023.

The U.S. market will still begin to recover at some point next year, most experts believe. But how quickly it will return to the historic highs reached in January of this year remains questionable. BI analysts estimate it won’t happen sooner than two years from now.

The fact that the Fed intends to keep rates high for at least the whole of 2023 could result in an average annual growth rate of 5.7% over the next three years for the S&P 500 index, versus 12.7% from 2010 to 2019, said BI Senior Equity Analyst Gina Martin Adams.

Earlier we reported that Europe’s largest stock indices, except for Spain, declined.