The Dow is going down but it’s hardly ever avoiding confirming a bear market

The Dow is going down but it’s hardly ever avoiding confirming a bear market

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By Medha Singh

(Reuters) – Leading stocks fell to their lowest level since November 2020 on Friday, but narrowly missed the close by more than 20 percent from their Jan. 4 closing high.

A Dow Jones closing below 2,9439.72 would have confirmed a bear market that started from that record, according to a widely used definition. The Dow Jones fell 486.27 points, or 1.62%, to close at 29590.41.

The Dow is the only one of the three major indices that does not have a bear market status. It achieved that dreary milestone in June and the Nasdaq in March.

The renewed selling pressure in the markets came in a week that saw the US Federal Reserve raise interest rates by three quarters of a percentage point for the third time in a row and pledged to hold them until inflation is under control.

It’s been a tumultuous year on Wall Street, plagued by concerns about the Russian invasion of Ukraine, the energy crisis in Europe, and the end of the world’s easy money policy.

The S&P 500 has lost 23% this year and the Nasdaq is down 31%.

The last time all three indexes fell sharply was in 2020 during the height of the pandemic sell-off.

Growing fears of a recession in the United States next year and its impact on corporate earnings have prompted brokerages to lower their year-end targets for the S&P 500 Index.

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