Will shares go up in 2023? CommSec forecasts lift

If you’ve wondered about whether to dive into the world of online share trading in 2023, economists at CommSec are forecasting a 4.7% lift in the Australian share market over the next twelve months.

It could be the start of a recovery from last year’s slump. 

The Australian share market fell 5.5% in 2022, according to the CommSec Year in Preview report. 

This reversal of fortune could depend on factors like inflation, global interest rate changes, and the recovery of China’s economy, among others, according to CommSec’s Chief Equities Economist Craig James. 

“High levels of inflation, continued uncertainty about interest rates, tight labour markets, high energy prices, the war in Ukraine and the re-opening of the Chinese economy pose both risks and opportunities for investors,” he said. 

2023 looks to be a year of slowed growth for the Australian economy 

Economists at the Commonwealth Bank of Australia (CBA) say the growth of the domestic economy is likely to slow from 3.5% in 2022 to 1.1% in 2023, citing issues in the global market. 

CBA also predicts another 25 basis-point interest rate rise in February 2023, when the Reserve Bank of Australia reconvenes. 

If this were to happen, this would take the cash rate to 3.35%, which could further reduce the borrowing power of Australians, and force households and companies to reduce their spending.

2023 may not be great for growth-focussed sectors 

Despite a recovery forecasted, CommSec says the global economy “may not be conducive for ‘growth-focussed’ sectors” in 2023. 

However, there may be good news for long-term investors with a focus on the future – both in the second half of 2023 and into 2024.  

With expectations pointing to interest rate cuts later this year, consumer discretionary (non-essentials), information technology, property, and small-cap companies may provide hope for investors in the second half of 2023, according to CommSec.

Are you looking to get started in share trading in 2023? Make sure you check out our share trading guide for absolute beginners, to help get your head around some of the key ideas when it comes to investing in the stock market. 

Or, if you’re a seasoned trader, looking for a fresh, new platform to invest with, compare share trading accounts with Mozo. You’ll find information like brokerage costs, monthly fees, and an overview of a platform’s features and capabilities at a glance. 

Here’s a preview of the accounts and offers currently available in the Mozo database: