NY.- Wall Street registered in 2022 its worst year since 2008, hit by the rises in interest rates by the United States Federal Reserve to put a stop to runaway inflation and weighed down by a greater prudence of investors, who anticipate a recession in 2023.
The Dow Jones Industrials, which groups the 30 largest companies in the country, lost an accumulated 8.8%, and the fall was sharper for the selective S&P 500 (-19.4%) and the Nasdaq index (-33 %), which bring together technology companies now in a debacle after years of stellar rise.
Read: Unemployment and inflation will be among the main problems
According to the analysis firm Fidelity, almost all corporate sectors ended the year in the red, first those of communications (-41%), non-essential goods (-37%) and technology (-29%), where They frame some of the biggest losers, such as Tesla (-65%) and Meta (-64%).
The exception has been the energy sector, which has shot up 56% in parallel with the rise in oil and gas prices, especially after the start of the war in Ukraine and, despite contributing to inflation, they have left succulent profits in the accounts of their corporations.
One of the determining factors for the downward course of the US market has been inflation, which was thought transitory but shot up to its highest level in 40 years, with a peak of 9.1% in June, and led the Federal Reserve to aggressively raise interest rates from March.
Inflation has begun to abate and the labor market does not seem to be suffering for the moment, but the central bank, which slowed the rate hike this December, expects unemployment to rise in 2023, and the shadow of a recession has sown fear in the markets.
Investors have been alert to signs that usually anticipate a recession, such as the inversion of the public debt yield curve, in which the lack of confidence in the situation translates into greater returns on short-term paper compared to long-term ones.
In addition to the collapse of the stock market, it has been one of the worst years in memory for fixed income and has also been marked by great volatility in raw materials and by the strengthening of the dollar against other currencies, César points out in a note González, financial director of Avanza Previsión.
MUSK, LAYOFFS AND FTX
In the day-to-day life of Wall Street, there has been news that has unleashed volatility, such as the purchase process of Twitter by the world’s richest man, Elon Musk, for 44,000 million, after which the social network has left going public and undertook massive layoffs.
Those of Twitter have joined a wave of layoffs and hiring freezes that have been carried out by large technology companies such as Meta, Amazon Microsoft or Netflix, the most benefited from the trend to work and entertain digitally from home after the outbreak of the pandemic in 2020. .
Nor has it been a good year for the cryptocurrency market, where a “crypto winter” seems to have arrived that can be attributed to the bursting of a bubble and the uncovering of fraudulent activities, as in the case of the FTX platform, previously respected and now in bankruptcy proceedings.
Bitcoin, the most widely used digital currency, has gone from close to $45,000 at the beginning of the year -it reached a record of 65,000 in 2021- to oscillate around $16,500 at the close of the US market, an accumulated annual drop of 65%. .