The U.S. equity market has seen rough times in 2022. However, investors seem to be getting some relief now, especially since the Federal Reserve hiked the benchmark interest rate by 50 basis points in December 2022, which is lower than the 75 basis points increase announced in the four previous meetings.

The Federal Reserve's stance of slowing down interest rate hikes is indicative of cooling inflation in the coming months. This scenario bodes well for high-growth technology companies such as Microsoft (MSFT -1.84%) and Taiwan Semiconductor Manufacturing (TSM -4.86%), which are being affected by high inflation due to an increase in the cost of borrowing for funding expansion projects and reduced long-term earnings and cash flow estimates.

Against this backdrop, here's why these two companies can prove to be attractive picks before 2023.

1. Microsoft

Microsoft is one of the more obvious stocks to go for before 2023, despite the stock falling by over 22% this year. The company is a force to reckon with in rapidly growing areas such as cloud computing and gaming.

Microsoft's cloud business, Azure, is a major growth driver and accounted for a 21% share of the global cloud infrastructure services market at the end of the third quarter (ending Sep. 30). The company reported a 20% year-over-year jump in intelligent cloud sales in the first quarter of fiscal 2023 (ending Sep. 30) to $20.3 billion. With the global cloud infrastructure services market expected to grow from $73 billion in 2019 to $166.6 billion in 2024, this dominant cloud player has significant room to grow in the coming years .

Microsoft made waves in the gaming industry when it announced the $69 billion acquisition of Activision Blizzard -- a move expected to strengthen Microsoft's position in the $170 billion global gaming business across several channels such as console, mobile, personal computer, and cloud gaming.

The deal, however, has run into a roadblock since the Federal Trade Commission sued Microsoft for antitrust issues. However, even if the deal does not go through, Microsoft has already developed a broad gaming ecosystem comprising Xbox consoles (gaming hardware) and self-owned gaming content.

The global cloud gaming market is a high-growth market and is expected to grow annually at a compounded average growth rate (CAGR) of 69% from $1.6 billion in 2021 to $13 billion in 2025. Microsoft is well poised to capture a significant share of this opportunity, thanks to its prowess in cloud infrastructure services. The company is already offering a beta version of its cloud gaming service to users of Xbox Game Pass Ultimate (multigaming monthly subscription service).

Microsoft is currently trading at 26.5 times its earnings, which is significantly below its five-year average of 35.1. Coupled with the company's solid fundamentals, Microsoft seems to be a bargain now.

2. Taiwan Semiconductor Manufacturing

The largest independent foundry in the world, Taiwan Semiconductor Manufacturing, is definitely a company to consider for your portfolio before 2023 -- despite the anticipated slowdown in the semiconductor industry in the coming year. The company catapulted to public attention in November 2022 after Berkshire Hathaway picked up a $4.8 billion stake in the chip giant.

Thanks to superior technology, TSM has been ahead of major competitors such as Intel, Globalfoundries, and Samsung in terms of advanced node production (smaller, more efficient chips). The company dominated the global foundry market with a share of 56% at the end of the second quarter (ending June 30), while Samsung was a distant second with a share of only 13%.

TSM enjoys significant pricing power, considering that the company plans to increase the prices of its chips starting Jan. 1, 2023, despite softening demand trends in consumer end-market segments. Further, since the semiconductor supply chain inventory is at a peak level, demand for chips is expected to taper down in the coming quarters.

Yet, the company expects to overcome these challenges based on its differentiated and optimal technology, secular growth trends in the high-performance computing market, and strategic long-term relationships with several major clients such as Apple, Nvidia, and Intel.

TSM is currently trading at 12.8 times earnings, which is close to its historically low levels. The company is highly profitable, with a net profit margin of 42.5%. TSM also boasts a strong balance sheet, with cash of $1.5 trillion and debt of $901.6 billion.

Although TSM faces significant geopolitical risk (a possible invasion of Taiwan from China), the risk-reward equation for this company makes it a compelling buy before 2023.