The Dow Jones Industrials, which groups the 30 largest companies in the country, lost an accumulated 8.8%, and the fall was sharper for the selective S&P 500 (-19.4%) and the Nasdaq index (-33 %), which bring together some tech companies now in debacle after years of stellar rise.
According to the analysis firm Fidelity, almost all corporate sectors dismiss the exercise in Red numbersfirst those of communications (-41%), non-essential goods (-37%) and technology (-29%), where some of the biggest losers are included, such as Tesla (-65%) and Meta (- 64%).
The exception has been the sector of Energywhich has shot up 56% parallel to the rise in oil and gas prices, especially after the start of the war in Ukraine and, despite contributing to inflation, they have left succulent profits in the accounts of their corporations.
Inflation, determining
One of the determining factors for the downward course of the US market has been inflation, which was thought to be temporary but shot up to its highest level in 40 yearswith a peak of 9.1% in June, and led the Federal Reserve to aggressively raise interest rates starting in March.
Inflation has begun to subside and the working market at the moment it does not seem to resentbut the central bank, which has slowed the rate hike this December, expects unemployment to rise in 2023, and the shadow of a recession It has sown fear in the markets.
Investors have been alert to signs that usually anticipate a recession, such as the inversion of the public debt yield curve, in which the lack of confidence in the situation translates into greater returns on short-term paper compared to long-term ones.
In addition to the stock market crash, it has been one of the worst years in memory for fixed income and it has also been marked by great volatility in raw materials and by the dollar strengthening against other currencies, César González, financial director of Avanza Previsión, points out in a note.
Musk, layoffs and FTX
In the daily life of Wall Street there has been news that has unleashed volatility, such as the purchase process Twitter by the one who was the richest man in the world, Elon Musk, for 44,000 million, after which the social network has stopped trading on the stock market and undertook massive layoffs.
Those of Twitter have joined a wave of layoffs and hiring freezes that have been undertaken by large technology companies such as Meta, Amazon, Microsoft or Netflix, the most benefited from the trend to work and entertain digitally from home after the outbreak of the pandemic in 2020.
It has not been a good year for the cryptocurrency market either, where seems to have arrived a ‘crypto winter’ which can be attributed to the bursting of a bubble and the uncovering of fraudulent activities, as in the case of the FTX platform, once respected and now in the process of bankruptcy.
The bitcointhe most widely used digital currencyhas gone from close to 45,000 dollars at the beginning of the year -it reached a record of 65,000 in 2021- to oscillate around 16,500 dollars at the close of the US market, a cumulative annual drop of 65%.