June 6, 2023

Brighton Journal

Complete News World

Dow drops 700 points in bear market, S&P 500 heads for new close in 2022

Dow drops 700 points in bear market, S&P 500 heads for new close in 2022

Stocks fell on Friday to wrap up a tough week for financial markets as rising interest rates and foreign currency turmoil heightened fears of a global recession.

The Dow Jones Industrial Average plunged more than 700 points to fall below 30,000 to a new low for the year. The 30-share index is down 20% from its high, known as Wall Street’s bear market territory. His last trade was 756 pips, or 2.5%. The S&P 500 fell 2.7% and headed for a new closing low in 2022, while the Nasdaq Composite fell about 2.8%.

“The market was clearly and rapidly moving from concerns about inflation to concerns about an aggressive Fed campaign,” said Quincy Crosby of LBL Financial. “You see bond yields rising to levels we haven’t seen in years – it changes the Fed’s way of thinking about price stability without a break.”

British pound hit a New low more than three decades Against the US dollar after a new economic plan in the UK that included a series of tax cuts shook markets that fear inflation above all for the time being. Major European markets Lost 2% per day.

“This is a global total mess that the market is trying to sort out,” Crosby said.

Friday witnessed the fourth consecutive negative session for the major averages. The Federal Reserve decided on Wednesday to raise the benchmark interest rate by 75 basis points and indicated it would do so again at its November meeting.

Bond yields soared this week after the Fed’s actions, with two- and 10-year Treasuries hitting levels not seen in over a decade.

See also  Boeing CEO calls Trump's Air Force One deal a risk 'maybe shouldn't have been taken'

Goldman Sachs S&P 500 target cut for year-end Because rates are rising, with a drop of at least 4% expected from here.

The stocks that have suffered the most in the recession led losses this week with the discretionary consumer goods sector of the S&P 500 down 7%. Energy prices fell more than 9% as oil prices fell. Growth stocks including big tech names Apple, Amazon, Microsoft and Meta Platforms slipped on Friday.

“Based on our clients’ discussions, the majority of equity investors have taken the view that a difficult downside scenario is inevitable and their focus is on the timing, size and duration of a potential downturn, and the investment strategies for these expectations,” Goldman Sachs wrote. David Costin in a note to clients as he cuts his gaze.

The major averages are fast paced for their fifth decline in the past six weeks. The Dow has shed about 4.5% this week, while the S&P and Nasdaq are down 5.2% and 5.5%, respectively.