The last week on the stock exchange of the year began with a noticeable tack drop – Tesla’s share fell to its lowest level since the summer of 2020

After a broad rally on European stock exchanges on the first trading day of the week, things ended up like this on Wall Street on Tuesday:

• The Dow Jones rose 0.1 percent.
• The S&P 500 index fell by 0.4 percent.
• The Nasdaq index fell 1.4 percent.

Tesla shares ended the day down more than 11% and are now down more than 70% so far in 2022. The stock closed at $109, from a peak of over $400 last fall, and is now at its lowest level since late summer 2020.

Southwest Airlines fell more than six percent after canceling nearly 3,000 flights on Monday and another 2,500 on Tuesday. The background to the mass cancellation is bitter cold and severe weather in several places in the United States over the Christmas weekend, write The Wall Street Journal.

the weakest since the financial crisis

There’s no escaping the fact that it’s been a very tough year for the stock market, and all three of the leading NYSE indices are heading into a negative return not seen in over a decade.

For the Dow, with just under a week left in the year, the conclusion is an 8.6 percent decline in 2022. It is the weakest year for the heavy industry index since the financial crisis of 2008, when the decline ended at 33.8 percent for the year.

In December, the drop was just over four percent, and if it continues, it will break a two-month high that began in the fall.

Meanwhile, the S&P 500 is down 19.3 percent so far this year, heading for its first annual decline in three years and its weakest year since 2008, when the decline ended at 38.5 percent. The Composite Index is also heading for its first monthly decline in two months.

But the biggest drop is the Nasdaq index. The big tech index has been hit hard by rising inflation and rising interest rates, with many bets being made on growth companies. Common to many of these is that companies are priced based on expected future earnings, which means that future cash flows discounted at higher rates of interest yield a lower present value.

This became clear. The Nasdaq is heading for a decline of more than 30 percent for 2022, and is also heading for its weakest year since 2008, when the decline was 40.5 percent.

lower volume

While many in both the US and Norway were waiting for a so-called “Christmas rally” in the stock market until the end of the year, the massive recovery was long overdue.

The period from December 15th to the first weekend of January in recent years has brought a very strong return in the stock market. Over the past thirteen years, the main index has risen on average by more than four percent over these three weeks, DN wrote before Christmas.

In the Christmas period, there may also be a little more movement than usual, due to the decrease in trading volume between Christmas and New Year.

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