The soaring Australian sharemarket will continue to rise early in the year, spurred on by rising commodity prices and higher expectations of interest rate cuts, leaving some strategists and fund managers worried it is sending some stocks too high.

Expectations that the Federal Reserve in the United States will pivot away from interest rate rises – bringing other major central banks with it – pushed the local exchange higher in December. On Tuesday, the S&P/ASX 200 Index closed just 1.1 points below a record high of 7628.9 points set in August 2021. Late on Tuesday, futures were pointing to a slight fall when the market opened the following morning.