The ride upward won’t be easy, but there are mounting signals that the stock market has already hit its low point.
For starters, the S&P 500 is down 17% from its all-time high of 4796 hit in early January. It was down as much as 25% to its lowest close of the year of 3577, hit in early October. One key driver was that the Federal Reserve has been ratcheting interest rates higher in order to combat high inflation by reducing economic demand. That’s even after the inflation had already begun denting consumer demand. Plus, faster-growing technology companies have seen their valuations, or their stocks’ multiples of expected earnings, take a hit partly because higher rates make future profits less valuable. Those companies are expecting a bulk of their profits to come many years in the future.
Source: finance.yahoo.com