January 29, 2023

Stocks fall in the last trading session of 2022 as Wall Street wraps up its worst year since 2008

Stocks fell on Friday as investors made their final trades in the market’s worst year since 2008.

The Dow Jones Industrial Average fell 127 points, or 0.4%. The S&P 500 fell 0.6%, while the Nasdaq Composite fell 0.8%.

Friday marks the last day of trading in what has been a painful year for stocks. A volatile bear market, sticky inflation, and wild interest rate hikes from the Federal Reserve have hurt growth and technology stocks. These factors also affected investor sentiment.

All three major averages are on track for their worst year since 2008, and are set to snap a three-year winning streak. The Dow Jones had the best performance of the indices in 2022, down 8.58% through Thursday, while the S&P and the tech-heavy Nasdaq were down 19.24% and 33.03%, respectively.

With the calendar year just around the corner, some investors believe the pain is far from over, and expect the bear market to continue until a recession hits or the Fed pivots. Some project stocks will also hit new lows before rebounding in the second half of 2023.

“We’re kind of stuck in a neutral position right now, because there are more unanswered questions than which entities are known. … We have a lot riding in the coming earnings season, when we think about the pressures that will lead to earnings,” said Rebecca Felton, chief market strategist at Riverfront Investment Group. Group, on profit marginssquawk box. “

“There are a lot of questions as we head into the new year, but we certainly will be happy to see 2022 come to an end,” Felton added.

Despite the annual losses, the Dow Jones and the S&P 500 are on track to snap a three-quarter losing streak. Still, the tech-heavy Nasdaq is on track for its fourth consecutive negative quarter for the first time since 2001.

Shares of telecoms services in the S&P 500 are down more than 40% over the year, consumer ratings are down 37.4%, while energy prices, the only positive sector of the blue-chip index, are up nearly 58%.

On the economic front, Chicago PMI data for December is due on Friday. Next week will see a more active slate of economic data, highlighted by the Non-Farm Payrolls report due on January 6th. Financial markets are closed on Monday for the New Year holiday.

Gabriel Curtis contributed reporting

Correction: The chart in this story has been updated to reflect the correct year-to-date decline in the Dow Jones Industrial Average.