The Dow Jones Industrial Average and S&P 500 wiped out gains from 2018 on Tuesday and fell below their Jan. 1 levels.
The S&P closed down 49 points, or 1.8 percent, while the Dow Jones fell 551 points down, about a 2.2 percent drop.
It was the second day in a row of massive losses on U.S. markets. Declines in tech sector stocks also led to a significant drop in stock prices on Monday.
According to CNBC, the group of high-powered tech stocks known as FAANG (Facebook, Amazon, Apple, Netflix and Google) have collectively lost $1 trillion in value since their market peaks earlier this year.
The financial news network’s survey of chief financial officers also found that more than half of them expected the Dow to drop an additional 2,000 points before it heads back to recent peaks.
This year has been a volatile one for stocks, which saw exuberant gains as the GOP tax law went into effect, followed by sharp drops as investors became concerned about rising interest rates and overinflated asset prices.
A November 19 report from Goldman Sachs analyst David Kostin outlined gloomy expectations from the markets.
“We forecast S&P 500 will generate a modest single-digit absolute return in 2019. The risk-adjusted return will be less than half the long-term average,” he wrote.
Investors may be better off getting out of the market, he added.
“Cash will represent a competitive asset class to stocks for the first time in many years,” he wrote.
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Stock market drop erases all gains from 2018 https://t.co/erpUV5hlKR pic.twitter.com/b7ydg8jhLU
— The Hill (@thehill) November 21, 2018
Winning!
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