Shares have been whipping up in recent weeks.
US Stocks: The S&P 500, one of the broadest stock market indices, entered the bear market during Friday trading. That means a drop of 20% from the recent peak in January.
The bear market is seen as a key measure of investor pessimism and is a sign of deep and persistent market sales. It is defined as the period in which the stock or market index drops 20% or more from the recent high.
The S&P 500 bear market did not last long in the area and recovered to end the day. However, the index is off more than 3% a week, posting its seventh consecutive week of decline, only five times since 1928, said Howard Silverblatt, senior index analyst at S&P Dow Jones Index.
Shares have been whipping up in recent weeks and months as they worry about high inflation and rising prices. There is also the fear that these forces may lead the country into a recession.
“We are looking at a very narrow path to achieving a smooth landing and will continue to expect a mild recession by the end of 2023,” Deutsche Bank’s chief US economist Matthew Luzetti said in a recent note.
Apart from inflation, the extent of the uncertainty has obscured Wall Street. The war in Ukraine has led to higher commodity prices worldwide, and new COVID lockdowns in China have caused worries over supply-chain issues.
Deer was among the biggest stock market losses Friday, making it one of the world’s largest tractor manufacturers. He said the company was paying too much for the materials and was facing a shortage of parts. Deer shares fell 15%.
This comes after Walmart and Target reported earlier this week that their customers were seeing signs of changing their shopping habits. Some were buying less and others were moving away from more expensive things.
Brett Biggs, CFO of Walmart, also told CNBC that consumers are trading for cheaper brands and prefer smaller sizes, such as a half-gallon of milk and a lunch-meat brand instead of a price-brand.
The S&P 500 is a U.S. An index that tracks 500 stocks of large companies. It is the health barometer of corporate America and is considered one of the key indicators of the US economy.
Trillions of dollars are invested in index funds that make up the S&P 500 stocks, including retirement portfolios. When the value of the index declines, it leaves little for retirement income, which is one of the biggest causes of concern for pensioners.