The S&P 500 dropped 2% on Friday, putting the benchmark for U.S. stocks 20.7% below its intraday record reached in January. The index is now headed for a close that’s more than 20% below its January record closing level as well.
This is the first Bear Market since the Covid Pandemic hit in March of 2020, and given its history, it would have officially begun in January.
“Stocks are still liberally priced and the psychology that drove them upward for a decade has turned negative. The average bear market lasts a year (338 days, more precisely). This downturn has run for only one-third of that, so it probably has more downside room to run, albeit punctuated by interim rallies,” according to George Ball, chairman of Sanders Morris Harris.
The Dow Jones Industrial Average fell 538 points, or 1.7%, with the benchmark losing steam after a strong open. The Nasdaq Composite dipped 2.8% and is already deep in bear market territory, trading 31% off its highs.
The Dow is down 4% for the week, in what would be the first 8-week losing streak since 1923. The S&P 500 dropped 5% this week, while the Nasdaq dropped 6%.
Inflation, energy prices, and the Ukraine conflict are all being cited as causes of the declines.
