Major US stock indexes traded below their June lows Friday, with the blue-chip Dow Jones Industrial Average on track to enter a bear market, capping an ugly week for global equities as investors reacted to central banks sharply raising interest rates in an effort to rein in high inflation.
The Dow Jones Industrial Average DJIA,
down 765 points or 2.5%, at 29,312 Friday afternoon, trading below its June 17 closing low of 29,888.78. A finish at or below 29,439.72 would mark a 20% fall from the DJIA’s record close of 36,799.65 set on Jan. 4, which would meet the widely used definition of a bear market.
The big question, however, remains around the broader S&P 500 index SPX,
and the potential for the more closely followed large-cap benchmark to take out its June 16 closing low at 3,666.67 or its June intraday low just below 3,637. The S&P 500 was down 102 points, or 2.7%, at 3,656.
Global equities fell sharply on Friday, with US stocks suffering steep losses. The Federal Reserve earlier this week delivered another outsize interest rate hike and signaled it would drive rates higher than market participants had previously anticipated. A number of other global central banks also delivered rate increases this week, underlining investor worries about the economic outlook.
See: Fed will tolerate a recession, and 5 other things we learned from Powell