S&P 500 Touches Bear Mark, Nasdaq Extends 6-Month Loss to 30%

Barry Adams
20 May, 2022
New York City

Eight-week long market selloff accelerated and broadened to all sectors and dragged popular indexes to new lows in the year with the S&P 500 briefly dipping in the bear territory. 

At close, the S&P 500 index inched up 0.57 to close at 3,901.36 and the Nasdaq Composite index edged down 0.3% to 11,354.62. 

In intra-day trading, the S&P 500 index dipped briefly in the beat territory for the first time since March 2020 when the index stayed there for 33 days. 

The Nasdaq index peaked on November 19, 2021 at 16,057.44 and the S&P 500 peaked on January 3, 2022 at 4,796.54. 

The Nasdaq index has fallen more than 31% in the last six months when it peaked in November. 

The Nasdaq has been in the bear market for the last six months and the S&P 500 index for four months counting its intra-day low today. 

Investors consider the beginning of the bear market when the index declines 20% from the recent peak. 

Stocks have been volatile for the last eight weeks and popular indexes have been posting weekly losses for the last eight week on the worry that the Fed may not be able to tame the elevated inflation without tipping the economy into a recession. 

Market sentiment was dented severely after two leading retailers Walmart and Target reported sharply weak quarterly results this week and lowered outlook for the rest of the year. 

Elevated food and energy prices have kept consumers on guard for the last eighteen months and the low income consumers have been hit the hardest with the inflation. 

High growth and high priced tech stocks have been on the slide for the last three months and the once popular Internet stocks are now down between 50% and 75%. 

Zoom Video, Paypal, Holdings, Netflix, Etsy, Wayfair, Shopify, have dropped more than 70% in the last six months. 

Amazon has dropped 40%, Microsoft and Google have lost 25%, and Apple has declined 15% in the last six months. 

 Except for the energy sector, all other sectors are now down 20% or more. 

Crude oil edged higher 40 cents to close at $112.70 a barrel suggesting that the fuel price driven inflation is here to stay for many more months to come. 

The yield on 10-year Treasury notes edged lower to 2.79%. 

For the week, the S&P 500 and the Nasdaq Composite index dropped 2.8%. 

The S&P 500 index declined for the seventh week in a row and posted its longest losing streak since 2001 and the Nasdaq Composite has fallen for the eighth week in a row.  

The Dow Jones Industrial Average declined 2.3% in the week and fell for the eight week in a row, longest streak of losses in 1932.