S&P 500 enters bear market again as stocks fall: NPR


Traders work on the floor of the New York Stock Exchange (NYSE) on Friday in New York. Stocks fell on Monday after a stronger-than-expected inflation report sent the S&P500 into a bear market.

Spencer Platt/Getty Images


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Spencer Platt/Getty Images

S&P 500 enters bear market again as stocks fall: NPR

Traders work on the floor of the New York Stock Exchange (NYSE) on Friday in New York. Stocks fell on Monday after a stronger-than-expected inflation report sent the S&P500 into a bear market.

Spencer Platt/Getty Images

It looks like another bleak day on Wall Street as inflation fears escalate.

The S&P 500 fell back into bearish territory on Monday after falling more than 2% at the open, meaning the broad benchmark is now down more than 20% from its most recent peak.

Other indexes also fell, with the Dow Jones Industrial Average down 2%, or more than 600 points, while the Nasdaq fell 2.8%.

The falls were triggered by a stronger-than-expected inflation report on Friday, raising fears that the Federal Reserve may have to raise interest rates even more aggressively this year.

The Fed begins its two-day meeting on Tuesday and was already expected to raise interest rates by half a percentage point for a second consecutive month.

The latest inflation report now increases the likelihood of further significant rate hikes in the months ahead. These actions may help rein in price increases, but markets fear the strong central bank response could also push the economy into recession.

“U.S. equity markets are reacting negatively to last week’s higher-than-expected reading for inflation,” said Sam Stovall, chief investment strategist at CFRA.

“Investors are now increasingly concerned that the Fed is too far behind the curve to slow the rise in inflation without plunging the economy into recession,” Stovall adds, referring to when a central bank is slow to deal prize winnings.

Stocks have had a miserable year due to inflation fears. The Nasdaq, which has a higher concentration of tech stocks, has been in a bear market for months.

A bear market is considered an important barometer of investor pessimism and symbolizes a strong and sustained sell-off in the market.

This developing story will be updated


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