Wharton professor Jeremy Siegel believes Wall Street analysts are being too negative about the stock market as they expect a major sell-off in the first half of 2023, followed by a recovery in the second half. Siegel believes that when everyone expects the same thing, that’s exactly what doesn’t happen, writes Business Insider.

“I think we’re [on the cusp of a new bull market] because everyone is saying the first half is going to be bad and the second half will probably be better, but when everyone thinks the same, they’re usually wrong.”

There are other reasons for stocks to rise this year: lower inflation, as evidenced by last week’s Consumer Price Index (CPI) report for December: the annualized rate fell to 6.5%, and prices were down 0.1% from the previous month.

“When I see the actual housing data in the numbers, you actually get negative core inflation. And the Fed at some point will be forced to realize that the inflation problem is solved. That’s one of the reasons the market has rallied, and I don’t think the Fed is going to abandon its tight policy.”

This means that the Fed is close to ending its cycle of interest rate hikes, and if it moves to lower rates, the economy has a chance of avoiding a recession. Although this would go against the general consensus that a recession in the US this year is inevitable.