From the desk of Willie Delwiche.
The S&P 500 fell 3.4% last week, the 11th time this year that the index was down 3% (or more) in a single week. Only 2008 and 1974 had a larger number of such declines. Paired with the 9 times the S&P 500 has rallied 3% or more in a single week this year, 2022 has now moved ahead of 2009 and is only in third place (still behind 2008 and 1974) with 20 weekly swings of 3% or more in either direction.
More Context: Stock market strength and volatility have been inversely correlated for decades. Volatile years tend to be weak and quiet years tend to be strong. The decline in the S&P 500 last week alone was larger than the largest peak-to-trough decline experienced over all of 2017 (one of the quietest and most consistently strong years in stock market history). This year’s volatility has been accompanied by the smallest percentage of days with more new highs than new lows in more than 50 years. While we are seeing relative leadership shift, persistent strength remains elusive.
In our Market Notes, we take a Deeper Look at the sector trends and global data that are pointing to improving leadership (if not outright strength) overseas.
