During the year 2022, the stock market went through one of its worst years, as the wave of decline in stock prices led to a decrease in the number of people who wanted to invest.
As stocks headed into the Christmas holidays with a small weekly decline, the S&P 500 fell 0.2 percent in the past five days, bringing its monthly loss to nearly 6 percent, Bloomberg reported.
December is the fourth worst month in 2022 for the stock market, in which the rises this year did not reflect any positive indicators, so optimism among investors was quickly taken away.
The large buying gatherings were nothing but traps that investors fell into. Buying stocks, after rising by 1 percent for days, led to huge losses after the Standard & Poor’s 500 index fell by 0.2 percent.
The expert in investment services, Justin Walters, said that after the old common saying on Wall Street was urging the purchase of stocks when price levels are low, the correct saying for the year 2022 is to urge the sale of stocks at low price levels.
Traders sold $20 billion in stocks in December, pushing total operations in recent months to about $100 billion, a 15 percent decline from the increases stocks had accumulated over the previous three years, according to Bloomberg.
The mood now prevailing among professional traders is “gloomy” about the stock market. In a survey of money managers by Bank of America, cash holdings rose to 6.1 percent during the fall, which is the highest level it has reached since the economic repercussions of the September 2001 terrorist events began to appear. Equity allocation in the portfolio fell to an all-time low.
Although this decline in stocks was not as bad as in 2008, which erased more than half of the value of the Standard & Poor’s 500, it sparked a similar “craze”, according to Bloomberg.
Even government bonds, which have generated positive returns during every bear market since the 1970s, have failed this time, as shown by the Bloomberg Treasury Index dropping 12 percent in 2022, the first year in at least five decades that bonds and equities have suffered simultaneous losses. by at least 10 percent.
And the stock market remains volatile, as Reuters reported on Friday evening that the Standard & Poor’s 500 index closed higher, as investors evaluated inflation data in exchange for raising interest rates and fears of recession, while energy stocks jumped due to high oil prices.
A Commerce Department report showed that US consumer spending rose slightly in November, while inflation continued to slow, but not enough to dissuade the US Federal Reserve from continuing to raise interest rates over the next year.
The personal consumption expenditures price index, the board’s preferred measure of inflation, rose 0.1 percent last month after rising 0.4 percent in October.
According to preliminary data, the Standard & Poor’s 500 Index rose by 22.72 points, or 0.59 percent, to close at 3,845.11 points. The Nasdaq Composite Index rose 21.88 points, or 0.19 percent, to 10,495.93 points. The Dow Jones Industrial Average rose 178.71 points, or 0.54 percent, to 33,206.20 points.