Bear market isn’t over

Top of the morning, readers.?Phil Rosen here, ready to jump start your Friday with a breakdown of what some of Wall Street's top players expect for the stock market for 2023.

But first, our markets audio briefing is updating news headlines all day. You can listen to the latest right here:

One programming note before we dive in: You won't have to wait until Monday to get 10 Things in your inbox again.?

Tomorrow, you'll receive a?special weekend edition?of the Opening Bell newsletter, which features a fascinating Q&A from a veteran strategist about the state of the US economy and the biggest risks ahead.

Sound good?

Sign up here to receive Insider’s full 10 Things Before the Opening Bell newsletter — directly in your inbox.

1. Morgan Stanley's top market strategist said the bear market isn't over yet.?Investors might pour back into stocks on hopes of the Fed pausing rate hikes, but that's unlikely to have staying power going into the new year, according to Mike Wilson.?

"Powell's commentary is right in line with what we've been saying, which is that?they're going to pause probably in January?and the market is getting in front of that," Wilson said in an interview with Bloomberg on Thursday. "This is a classic Fed pause stock market rally."

In fact,?Wilson, who this year was named Wall Street's top portfolio strategist by Institutional Investor, warned that the S&P 500 could see another?26% drop?next year to as low as 3,000.?

His comments followed those of Fed Chair Jerome Powell, whose remarks this week caused markets to?surge?on the expectation that the central bank will slow the pace of interest rate increases at its meeting this month.?

"This rally will go further and will probably drag people back into thinking that this bear market is over," Wilson said.

Similarly, JPMorgan analysts wrote in a note to clients yesterday that the S&P 500 is set to?revisit this year's lows?early next year. They said the Fed's inflation fight won't end anytime soon, and that's going to?weigh on indexes.?

"Fundamentals will likely deteriorate?as financial conditions continue to tighten and monetary policy turns even more restrictive (Fed raises rates by another 75-100bp with an additional ~$1T in QT), while?the economy enters a mild recession?with the labor market contracting and unemployment rate rising to ~5%," the firm's analysts said.

Ultimately, JPMorgan's view is for disinflation, a rising jobless rate, and weaker corporate sentiment to force the Fed to signal a policy pivot.?

That move could then?lift the S&P 500 to 4,200?by the end of 2023, according to the bank. That's just slightly above where the benchmark index closed on Thursday, meaning investors should be prepared for tepid gains in the coming year.?

What's your full-year 2023 forecast for the S&P 500??

A) Below 4,100

B) 4,100-4,500

C) 4,500-4,800

D) Above 4,800

Let us know in the comments.

In other news:

2. These fund managers have beaten 98% of their peers in 2022.?They broke down the "keeper stocks" they are betting on for 2023 —?and the three market sectors they are overweight on heading into the new year.

3. Goldman Sachs made its case for why the US won't be hit with a recession in 2023.?Low jobless claims, positive wage growth, and slowing inflation are among the reasons analysts listed in their forecast.?Here are 10 reasons why they expect to skirt a downturn.

4. BlockFi is the latest victim in the crypto contagion. The fallout from FTX's collapse has spread to other companies in the digital asset space, and it's becoming more important than ever for investors to educate themselves on associated risks.?Experts shared their best tips to safely gain exposure to the market right now.

5. Shares of a Japanese company that makes MSG are up 29% and just notched a new record high.?Food seasoning maker Ajinomoto will accelerate its expansion in producing high-tech chipmaking film, the CEO told Bloomberg.?Find out more about its push into the hot semiconductor industry.

This is a condensed version of Insider’s 10 Things Before the Opening Bell newsletter. To see items 6-10, sign up here to receive the full newsletter in your inbox.

Plus, Insider has a wide array of industry-specific newsletters — see them all here.

And keep up with the latest markets news throughout your day by checking out The Refresh from Insider, a dynamic audio news brief from the Insider newsroom. Listen here.

This newsletter was curated by Phil Rosen.