2022 was a tough year for investors. Global economy had been materially impacted by tightening policies in developed economies and strict Covid Zero control in China. Risk asset prices declined across the board. On equity side, SPX plummeted by 19.4%. DAX declined by 12.93%. HSI slumped by 15.5% while SHCOMP also declined by 15.5% through the year. Commodity index corrected as well. CRB index -4.1% to 554. If look into intra-year movement, it was more volatile than ending price showed. In general, energy outperformed others, followed by precious metals, nonferrous metals and then ferrous metals.
For the outlook of 2023, the risks that had driven down asset prices have gradually eased. Inflation may have peaked in US and Europe. Policy tightening are still ongoing in major economies, but entering into late stage. China has loosened Covid Zero policies since November 2022 and is passing the peak of infection. China has also been gradually reversing its tight policy stance on property sector, by cutting mortgage rate for buyers and lift control on funding channels for property developers. Global economy will continue to step down in 2023. China is in a good position to grow faster than other major economies given its low base and massive stimulus policies to boost economy.