Stocks fell on Friday as investors made their final trades in the market’s worst year since 2008.
The Dow Jones Industrial Average fell 308 points, or 0.9%. The S&P 500 fell 1%, while the Nasdaq Composite fell 1.1%.
Friday marks the last day of trading in what has been a painful year for stocks. All three major averages are on track for their worst year since 2008, and are set to snap a three-year winning streak. The Dow Jones was the best performer of the indexes in 2022, down 9.4%, while the S&P and tech-heavy Nasdaq were down 20% and about 34%, respectively.
Steady inflation and aggressive rate hikes by the Federal Reserve dampened growth and technology stocks and weighed on investor sentiment throughout the year. Geopolitical concerns and volatile economic data also kept the markets on edge.
“We’ve had everything from Covid issues in China to the invasion of Ukraine. They’ve all been very dangerous. But for investors, that’s what the Fed does,” said Art Kashin, director of floor operations at UBS. “exchange.”
With the calendar year just around the corner, some investors believe the pain is far from over, and expect the bear market to continue until a recession hits or the Fed pivots. Some project stocks will also hit new lows before rebounding in the second half of 2023.
“I would tell you it’s going to be like ‘The Wizard of Oz’ and everything will be in glorious color in a moment or two. I think we may have a bumpy first quarter, and depending on the Fed it may last a little bit longer than that,” Cashin said.
Despite the annual losses, the Dow Jones and the S&P 500 are on track to snap a three-quarter losing streak. Still, the tech-heavy Nasdaq is on track for its fourth consecutive negative quarter for the first time since 2001. All three averages, however, are negative for December.
Shares of telecoms services in the S&P 500 are down more than 40% over the year, consumer ratings are down 37.4%, while energy prices, the only positive sector of the big-cap index, are up nearly 58%.
Gabriel Curtis contributed reporting
Correction: The chart in this story has been updated to reflect the correct year-to-date decline in the Dow Jones Industrial Average.