Wall Street closes worst week since 2020 with slight gain
NEW YORK (AP) — Wall Street closed out its most punishing week since the 2020 coronavirus crash with a meandering day of trading Friday that left it a bit higher.
The S&P 500 rose 8.07 points, or 0.2%, to 3,674.84 after waffling between modest losses and gains for most of the day.
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The Dow Jones Industrial Average dipped 38.29, or 0.1%, to 29,888.78, while the Nasdaq composite climbed 152.25, or 1.4%, to 10,798.35.
The relatively quiet trading capped a brutal, tumultuous week for Wall Street. The S&P 500 lost 5.8% for its tenth drop in the last 11 weeks.
That’s its worst week since March 2020, when stocks were in free-fall as the global economy suddenly shut down at the onset of the pandemic.
Markets around the world have been shuddering as investors adjust to the bitter medicine of higher interest rates that the Federal Reserve and other central banks are increasingly doling out.
Higher rates can bring down inflation, but they also risk a recession by slowing the economy and push down on prices for stocks, bonds, cryptocurrencies and other investments.
“Any lack of clarity or lack of confidence in the Federal Reserve is going to create a lot of volatility in the market,” said Megan Horneman, chief investment officer at Verdence Capital Advisors.
The S&P 500 remains in a bear market after it earlier this week dropped more than 20% below its record. It’s now 23.4% below its all-time high set in January and is back to where it was in late 2020.
“There’s a lot of uncertainty right now about the timing of a recession, but the risks are clearly rising,” Horneman said.
On Wednesday, the Fed hiked its key short-term interest rate by triple the usual amount for its biggest increase since 1994.
It could consider another such mega-hike at its next meeting in July, but Fed Chair Jerome Powell said increases of three-quarters of a percentage point would not be common.
