A sell-off earlier sent the S&P 500 down more than 20% from a January closing high, meeting the common definition of a bear market.
A dramatic late-session rally brought the S&P 500 back to the brink of a bear market, but the index still fell for a seventh consecutive week in a period of weakness not seen since 2001.
The benchmark closed the day with little change, after a massive sell-off sent it down more than 20% from a January closing high, meeting the common definition of a bear market. . At the end of another volatile week, the monthly expiration of options linked to stocks and exchange-traded funds exacerbated price swings. Treasuries gained along with the dollar as safe havens captured bids.
In a week marked by falling buying and rising selling prices, investors grappled with worries about an economic slowdown and the prospect of further monetary tightening, while retailers signaled the growing impact of high inflation on margins and consumer spending.
The S&P 500’s seventh weekly decline marked the longest losing streak since the bursting of the dotcom bubble more than two decades ago. It is only his fourth streak of seven or more weekly losses in the post-World War II period, according to Bespoke Investment Group.
“This is a small sample size, but these types of streaks did not occur during particularly positive times for the stock market,” the company’s strategists wrote in a note. “The root causes of the weakness were the hawkish FOMC and growing concerns about the potential for a recession.”
In the latest developments regarding Russia’s war in Ukraine, the Senate passed a Ukraine aid package worth more than $40 billion, sending the bill to President Joe Biden for his signature. Meanwhile, the industrialized countries of the Group of Seven will agree on more than 18 billion euros ($19 billion) in aid to Ukraine, according to German Finance Minister Christian Lindner.
What damage will be done to the US economy and global markets before the Fed changes tack and eases policy again? The “Fed Put” is the theme of this week’s MLIV Pulse survey.
Some of the major movements in the markets:
- The S&P 500 was little changed at 4 p.m. PT
- The Nasdaq 100 fell 0.3%
- The Dow Jones Industrial Average is little changed
- The MSCI World index fell 0.4%
- The Bloomberg Dollar Spot Index rose 0.2%
- The euro fell 0.3% to $1.0556
- The British Pound rose 0.2% to $1.2489
- The Japanese yen was little changed at 127.87 per dollar
- The yield on 10-year Treasury bills fell five basis points to 2.78%
- Germany’s 10-year yield was little changed at 0.94%
- The UK 10-year yield rose three basis points to 1.89%
- West Texas Intermediate crude rose 0.9% to $113.23 a barrel
- Gold futures are little changed
–With help from April Ma, Tassia Sipahutar, Michael Msika, Robert Brand and Isabelle Lee.