As the U.S. stock market has fluctuated since the beginning of this year, companies such as Netflix and Disney have entered the bearish market one after another.
According to the Wall Street Journal (WSJ) on the 17th (local time), some 220 of the companies with a market capitalization of $10 billion or more listed on the U.S. stock market fell more than 20% from their high point, entering a bearish market.
This included Walt Disney, Netflix, Salesforce, and Twitter, which are the stocks that make up the Standard & Poor’s 500 Index.
The technology stock-oriented NASDAQ fluctuated particularly severely.
According to Jason Goffert of Sundial Capital Research, 39% of the NASDAQ index stocks were halved compared to their high points. The NASDAQ index fell about 7% from its high point.
Goffert said that since 1999, around the time of dot-com bubble, the NASDAQ index has been so high that several stocks have never fallen so much.
This year, the U.S. stock market fell for the second consecutive week. The S&P 500 index fell 2.2% and the NASDAQ index fell 4.4%, respectively.
When the U.S. Federal Reserve (Fed) signaled that it would aggressively raise interest rates this year, government bond prices fell as interest rates rose to their highest level since 2020, which had an impact on the entire market. Technology stocks were hit the hardest.
“Fed put” died in 2022,” said Justin White, portfolio manager of investment management firm TrawPrice.
“Federal Foot” refers to the Fed coming forward to cut interest rates or delay interest rate hikes whenever the financial market is in trouble.
White manager said he is buying financial and energy stocks that can benefit from a rate hike.
His investment has been successful to date. The energy sector of the S&P 500 index rose 16% this month, while the financial sector rose 4.5%. On the other hand, technology stocks fell 4.8%.
