The Dow Jones New York Stock Exchange ended lower on Friday (Dec. 30), the last trading day of 2022 and the worst year for the market since 2008, hit by rising interest rates. Offensive to curb inflation, recession concerns, Russian-Ukrainian war and growing concern about the number of COVID-19 cases in China.
The Dow Jones Industrial Average closed at 33,147.25 points, a decrease of 73.55 points or -0.22%, the S&P 500 index closed at 3,839.50 points, a decrease of 9.78 points or -0.25%, and the Nasdaq index closed at 10,466.48 points, a decrease of 11.61 points or -0.11%.
in this week The Dow was down 0.2%, the S&P500 was down 0.1% and the Nasdaq was down 0.3%. The Dow dropped 8.8%, the S&P 500 shed 19.4% and the Nasdaq shed 33.1%.
All three indexes closed year-on-year declines in 2022 for the first time since 2018, pressured by the Federal Reserve raising interest rates at their fastest rate since the 1980s.
Sam Stovall, Chief Investment Analyst at CFRA Research states that “The market is under pressure from negative factors such as the ongoing supply chain disruption since 2020, rising inflation. and the Fed’s tightening of monetary policy to curb inflation.”
He also noted negative factors, including leading economic indicators pointing to a recession, geopolitical tensions including the Ukraine war. as well as the number of people infected with COVID-19 rising in China and tensions between China and Taiwan.
Growth stocks face pressure as Treasury yields rose for most of 2022 and performed worse than value stocks adjusted in line with the economy. This is a reversal of a trend that has been going for most of the past 10 years. Apple, Alphabet, Microsoft, India, Amazon and Tesla stocks are. Stocks that have fallen sharply by 28-66% in 2022.
Growth stocks in the S&P 500 are down about 30.5% this year, while value stocks are down 7.7%, with investors flocking to stocks with high dividend yields and stable earnings. It’s up 58% this year as oil prices soar.
Communications stocks are the ones that have slumped the hardest this year. with a fall of more than 40%
Ten of the 11 groups on the S&P500 closed lower on Friday. Led by real estate and utilities groups
Investors will focus on earnings prospects for listed companies in 2023 amid growing fears about the prospect of a recession.
However, signs of a recovery in the US economy have raised concerns. Interest rates may continue to rise. Even easing inflationary pressures have raised hopes about slowing rate hikes.
Financial markets expect a 65% chance the Fed will raise interest rates 0.25% at its February meeting. And the interest rate is expected to peak at 4.97% in mid-2023.
Wall Street stock market will be closed on Monday, Jan. 2, 2023 for New Year’s Day. And will open for business as usual on January 3