Mar 8, 2022 - Economy
Nasdaq falls into bear market territory
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The tech-heavy Nasdaq composite fell into bear market territory after a 3.6% tumble Monday.
Why it matters: A bear market is Wall Street's term for a 20% decline from a recent high. It's a more acute market slump than a "correction," which is a fall of 10% or more.
- But spiritually the onset of a bear market is much more. It marks a sharp shift in the mood music of the markets. The dour, the sour and the short-sellers of the world see their worldview validated by the market's inability to rally.
The big picture: So far, the Nasdaq composite has suffered a worse beating than the broader S&P 500, which is only down 12.4% from its Jan. 3 high.
- That's probably because the tech stocks that drive the performance of the Nasdaq tend to be especially sensitive to rising interest rates, which we've had in recent months.
