S&P 500 Hits Bear Market Territory

Down by 21.8% from January 3 to June 13, 2022

The S&P 500 Index fell below the 20% threshold to be considered a "bear market," at the close of trading on June 13, 2022. The index is down by 21.8% from its previous closing high, which it reached on January 3, 2022.

The current bear market is now 161 days old. The previous bear market, sparked by the newly unfolding COVID-19 pandemic, ran for 33 days from peak to trough (Feb. 19, 2020 to March 23, 2020), during which time the S&P 500 declined by 33.9%. The two bear markets prior to that were much lengthier and deeper. From March 24, 2000 to Oct. 9, 2002 (929 days), the S&P 500 dropped by 49.1%, From Oct. 9, 2007 to March 9, 2009 (517 days), it fell by 56.8%.

Key Takeaways

  • The S&P 500 Index ended trading on June 13, 2022 down by 21.8% from its previous closing high, which it reached on Jan. 3.
  • This means the S&P 500 is now in a bear market, normally defined as a drop of 20% or more in a market index.
  • Among the 11 S&P 500 industry sectors, ten are down year-to-date, and four of them by 20% or more.
  • Only energy is up, posting a 50.5% year-to-date gain.

Broad-Based Decline

Through market close on June 1, 11 of the S&P 500 sectors are down year-to-date (YTD) down so far in 2022. The lone exception, energy, is up by 50.5% for the year-to-date, as gas and oil prices have risen sharply this year.

Four sectors are down by 20% or more year-to-date: consumer discretionary (-33.3%), communication services (-31.4%), information technology (-28.5%), and real estate (-24.6%).

The six sectors posting year-to-date declines of less than 20% are financials (-19.6%), industrials (-17.1%), health care (-13.9%), materials (-13.8%), consumer staples (-9.5%), and utilities (-5.6%).

Biggest Stocks Down Sharply

The S&P 500 is a capitalization-weighted index. As a result, just six stocks, issued by five companies, collectively account for nearly 20.7% of its value, based on current calculations.

All these stocks have posted larger YTD declines than the S&P 500 as a whole, leading the index down. They are: Apple Inc. (AAPL), down 27.5%; Microsoft Corporation (MSFT), down 27.6%; Amazon.com Inc. (AMZN); down 39.2%; Alphabet Inc. (GOOGL, GOOG), down 26.6% and 26.3%, respectively;, and Tesla Inc. (TSLA), down 46.1%.

Article Sources
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  1. S&P Dow Jones Indices. "S&P 500."

  2. Yardeni Research, Inc. "Stock Market Briefing: S&P 500 Bull & Bear Market Tables."

  3. S&P Dow Jones Indices. "S&P Sectors."

  4. Slickcharts. "S&P 500 Companies by Weight."

  5. Yahoo Finance. "Stock Quotes."

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