Will the S&P 500 Follow the Nasdaq Into a Bear Market? An Exceptionally Rare Event That's Occurred Just 6 Times in 154 Years Has the Answer.
This highly uncommon event has, thus far, a 100% success rate of forecasting where the S&P 500 will head next.
Over the last two months, Wall Street has offered investors a not-so-subtle reminder that stocks do, in fact, move in both directions.
Since the benchmark S&P 500 (SNPINDEX: ^GSPC) peaked on Feb. 19, the famous Dow Jones Industrial Average (DJINDICES: ^DJI), S&P 500, and growth stock-oriented Nasdaq Composite (NASDAQINDEX: ^IXIC) have respectively lost 12.3%, 14%, and 18.8% of their value, as of the closing bell on April 17. The double-digit percentage declines for the Dow and S&P 500 place both indexes in correction territory, while the Nasdaq Composite has, as of its lowest closing value on April 8, firmly fallen into a bear market.
This historic stock market volatility is a reflection of investors' fear and uncertainty concerning President Donald Trump's "Liberation Day" tariff announcements, the growing prospect of the U.S. economy dipping into a recession, and rapidly rising Treasury yields, which threaten to increase borrowing costs for consumers and businesses.