S&P 500 suffers worst loss since 2008

Wall Street ended 2022 on a sour note as the S&P 500 index, Dow Jones Industrial Average and Nasdaq composite all posted losses for the year. The S&P 500 closed 19.4% lower, the Dow 8.8% lower and the Nasdaq 33.1% lower.

Inflationary pressure, Federal Reserve interest rate hikes, and volatile commodity prices were the primary drivers of the downturn, leading to declines for some of the largest companies in the market.

The Federal Reserve forecast that its key lending rate will reach a range of 5% to 5.25% by the end of 2023, with no rate cuts expected before 2024. Investors will be carefully monitoring economic indicators to determine if inflation is easing fast enough and if the Fed will need to adjust its rate-hiking campaign.

Corporate earnings reports will begin in mid-January and the government will release its latest updates on job openings and unemployment in the first week of the new year. These reports will give investors more insight into the health of the economy, and could potentially help shape their decisions in the days and weeks ahead.


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