US stocks closed significantly lower on August 19, 2022, extending the decline that led all three main indexes to end in the negative during the week.
On August 22, 2022, the Dow Jones Industrial Average fell 1.9%, the S&P 500 index fell 2.1%, and Nasdaq decreased 2.5%. The small-cap Russell 2000 index also fell 2.1%.
Merchants and technology firms suffered some of the biggest losses on August 22, 2022. Stocks of smaller companies also fell, pushing the Russell 2000 index down 2.1%. Investors are alarmed about the impending rapid increase in interest rate and a weakening economy. They are purchasing dollars while selling riskier assets such as bitcoin.
Exchange-traded funds declined, with the Nasdaq 100 tracker Invesco QQQ Trust and SPDR S&P 500 falling 1.7% and 2.1%, respectively.
Electric vehicle (EV) juggernaut Tesla fell 2.3% on August 22, 2022. Apple and Microsoft, two of the leaders on Dow Jones, declined 2.3% and 2.9%, respectively, on August 23, 2022.
Notably, real interest rates declined over the last five to six years, from 2.16% in 2017 to -0.87% in 2021, according to GlobalData.
In September 2022, the Fed will likely increase interest rates by about 50 basis points. However, many policymakers appear optimistic about a possible turnaround in the market.
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