By: Economic & Finance Report
Markets have been rippling downward for the past month or so, consistently. Prices of strong stocks have been trending downward. People are speculating that we are strongly entering the bear market. Analysts predict that the bear market can last until the Fall of 2022.
Analysts have also speculated that many investors will feel the “downward bear” as inflation, rates and seemingly adjustments in recession continues to shock the economy. The S&P 500 seems to be in correction mode from its enormous highs in prior years. The Nasdaq has already reached bear market territory, dropping 22% thus far this year.
Bonds are faring better, hitting multiple highs and its counterpart, bond prices have been diminishing gradually. 10-year treasury notes yield, and 30-years notes yields have risen to its highest since November and December of 2018. Investors have priced in the inflation rises and the interest raises by The Fed (Federal Reserve); though even still priced in shockwaves have still caused to market to drop drastically more than expected.
Bear markets have been very seldom, in the 140-year history of the global indexes. Only 9 bear markets have occurred in 140 years. With that many long investors, do believe the outcome will benefit in their favor because of time and history. Traders and investors have indicated that many of their stocks have already the rock bottom or close it and the only way from the rock bottom is to start climbing to the top, which is to be believed inevitable.
Over 75% of the Nasdaq index is in bear market, which includes much of the technology sector. The technology sector is trying to put out flames from highs that the sector incurred for the past year and which some experts believe was a “bubble” as technology companies stock prices were too high and needed to be adjusted or to come down from the highs. The bear market was indicative of that. -SB
Image Source: Forbes