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The blue-chip Dow Jones Industrial Average (DJI) tumbled to its lowest level since November 2020 on Friday, but narrowly missed ending more than 20% below its Jan. 4 closing record high.
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US stocks fell sharply in Friday trading as investors continued to worry about even more rate hikes from the Federal Reserve that could land the US economy in a recession. The S&P 500 (SPX) and the Nasdaq (COMP) Composite were down 1.7% and 1.8%, respectively.
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This was the fourth negative day in a row for the major indexes and their fifth decline in the last six weeks. The renewed selling pressure in markets came in a week that saw the US Federal Reserve raise interest rates by three-quarters of a percentage point for a third straight time and a vow to keep it going until inflation is under control.
26 Sep 2022
It’s Going Dow(n)
The Dow plunges to its lowest level since 2020
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Why it matters
Investors don't have many places to make money at the moment: In addition to sinking stocks, the bond market is also selling off, sending US Treasury yields soaring to 11-year highs in recent days. It has been a tumultuous year for Wall Street, plagued by worries about Russia's invasion of Ukraine, an energy crisis in Europe and the end of easy money policy globally. Wall Street also remains concerned that the Fed's rate-hiking plan could continue to increase borrowing costs, hurting the corporate profits that support their stock prices.