US Stock Market: S&P 500 Falls for Fourth Straight Week
The S&P 500 just closed its fourth straight week of losses, and Wall Street is getting nervous. The index closed at 6,507 on Friday, March 20, down 1.5% for the day and down 5.1% for the year. That might not sound catastrophic, but the trend is what matters.
More importantly, the S&P broke below its 200 day moving average at 6,619. That's a technical level traders watch closely. It's the first time the index has fallen below that line since May 2025. When stocks break through support levels like that, it often signals more pain ahead.
The Nasdaq fell 2% on Friday. Technology stocks got hammered as investors worried about expensive valuations and slowing growth. The Russell 2000, which tracks small company stocks, dropped 2.3% and is now officially in correction territory, down more than 10% from its recent peak.
What's driving the selling? A toxic combination of factors. Oil prices hitting $113 a barrel are raising inflation fears. The Federal Reserve flipping from rate cuts to potential rate hikes is scaring investors. Geopolitical risk from the Iran war is adding uncertainty. And corporate earnings expectations are getting cut.
Volume was heavy on Friday, with over 12 billion shares changing hands on the New York Stock Exchange. That's well above average, and it suggests this isn't just a few nervous traders selling. This is broad based distribution, meaning big institutional investors are reducing their stock positions.
Bank of America's latest fund manager survey showed sentiment at a six month low. Cash levels surged as investors pulled money out of stocks and parked it in safer assets. When professional investors get this defensive, it's usually a warning sign.
The question everyone is asking is whether this is just a healthy correction or the start of something worse. JPMorgan analysts warned that the S&P could fall to 6,000 if current headwinds intensify. That would be another 8% drop from here. Goldman Sachs cut their year end target to 7,200 but said near term risks remain elevated.
Energy stocks were one of the few bright spots, rallying on higher oil prices. ExxonMobil, Chevron, and ConocoPhillips all posted gains. But that wasn't enough to offset weakness everywhere else.
Consumer discretionary stocks got crushed. Amazon, Tesla, and Home Depot all fell sharply. When consumers are worried about inflation and gas prices, they cut back on non essential spending. Retailers are already warning about weaker traffic.
The bond market is flashing warning signals too. The yield on the 10 year Treasury note jumped to 4.3%, up from 3.9% just a few weeks ago. Rising yields make stocks less attractive and increase borrowing costs for companies.
For investors, this is a tough environment. Stocks are falling, bonds are falling, and even gold crashed 10% this week. Cash is starting to look like the only safe place to be.
