The daw It was slightly higher in late afternoon trade, recovering from a drop of about 475 pips earlier in the session. However, blue-chip stocks are still down 13% this year, and hit a new 52-week low Thursday morning before rebounding.
The Standard & Poor’s 500which is dangerously close to a 20% decrease from All-time high on January 3 In a bear market, it was up 0.5%. heavy technology Nasdaq, which is already in bear market territory, gained 1%. The Nasdaq is still down 26% this year alone.
Notable technology stocks were among the biggest losers in the market Thursday, after the Dow Cisco component
(CSCO) It reported sales that came in against expectations and also gave a poor outlook. Cisco
(CSCO) It’s down nearly 14% in the news.
The poor results for corporate leaders are sounding alarm bells about the recession, too. More experts are beginning to predict an economic downturn later this year or early 2023. The anxiety on Wall Street is palpable.
“What is the catalyst? What will make investors want to buy more and give them confidence in the market? I don’t think there is anything right now,” said JJ Kinahan, chief market strategist at Tastytrade.
(VIX), a measure of Wall Street’s volatility, is up more than 70% this year. and the CNN Business Fear and Greed Indexwho looks at VIX
(VIX) And six other measures of market sentiment, showing signs of extreme fear.
Investors should keep their seat belts on. “It is unlikely that this period of volatility will end,” said Tom Galvin, chief investment officer at City National Rochdale.
“There is a long list of uncertainties,” Galvin added, citing Fed rate policy and inflation, and concerns about the novel coronavirus outbreak in China and Russia’s invasion of Ukraine as continuing concerns.
Galvin said investors would do well to avoid speculation in technology stocks and European stocks due to concerns about excessive valuations and a possible economic recession. Instead, he recommends high-quality stocks that pay a steady dividend.
Investors may also be concerned about how market turmoil is hurting large hedge funds and other institutional investment firms.
Traders were saving on tech stocks with risky momentum, Bitcoin and other cryptocurrencies And other investments that could benefit from the economic recovery.
“There is definitely more fear and nervousness,” said Dan Pipiton, CEO and co-founder of TradeZero. “The collapse of the cryptocurrency is also having an impact. There is a wait-and-see approach. People are sitting on the sidelines waiting for a clear direction on what we’re in for.”
Instead, investors are now flocking to stocks that are seen as a better hedge against, and in some cases, the beneficiaries of inflation and High interest rates.
for example? Oil stocks are among the major gainers in the market this year. chevron
(CVX)up more than 40%, is Dow’s largest, and is one of Warren Buffett’s four largest holdings in Berkshire Hathaway
(BRKB)Which Hit the market hard this year.
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