The S&P 500, down more than 3% in late-morning trade, fell into bear market territory Monday – defined by a dip of more than 20% from its most recent high — with little upbeat news on the horizon and not much going well on three key fronts: surging inflation, rising interest rates and the Russia-Ukraine War.
The Nasdaq, with its higher concentration of technology shares, has been in a bear market for months.
The DJIA is down 700 points right now, off its lows at least, and the Nasdaq and Russell 3000 are also in the red in moves that echo steep losses Friday after inflation hit a 40-year low. This is one of the market’s toughest stretches and worst start-of-the-week openings in years as inflation hits consumers and companies alike fueled in part by the war that’s caused a disruptions including in global energy markets and grain supplies.
A series of interest rate hikes by the Federal Reserve to cool things down have had no apparent impact. The Fed will kick off its latest two-day meeting Tuesday, where it had been expected to boost rates by half a percentage point for the second month in a row. But the thinking seems to be now that central bank was behind the curve on rates and is considering a bigger hike when it announces one Wednedsay.
The balancing act is that if interest rates get too high that can push the nation into recession.
Every sector is being punished with crypto sinking too (Bitcoin was at its lowest level since late 2020).
In media, Warner Bros. Discovery and Paramount are down by more than 7%; AMC Networks and Netflix are off by 6%, Lionsgate by 5%, Disney by 4%, Fox by 3% and Comcast by 2%.
Roku, Fubo and Snap are all down around 10%. Amazon, Meta Alphabet and Apple are down down, Amazon the most.
Exhibitors are getting punched despite a stellar box office with two big summer tentpoles in Jurassic World Dominion and Top Gun: Maverick continuing to roar at the global box office. AMC Entertainment is off 10%, Imax 7% and Cinemark and Marcus, respectively, 5% and 3%.
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