U.S. markets are facing the worst in January since the global financial crisis

The US stock market has faced a serious crisis since the global financial crisis, with rising interest rates, slowdown in corporate earnings and global disputes that have led to an increase in stocks.

The S&P 500 index fell 5.3 percent in January, the lowest for the month since the coronavirus epidemic broke out in March 2020 and the weakest Januaryware since the global financial crisis in 2009.

The blue-chip benchmark was on the verge of doing better – last week it was closer to January than its record – up to 4 percent. recovery in the last two business days of the month Friday and Monday.

But despite the strong end, investors are working hard not to change.

Fund manager Franklin Templeton’s multi-asset division, for example, meets once a month to change the amount of distribution of different types of assets. But he decided to start a weekly meeting to make sure he could respond quickly to instability.

“Being this kind of year – we believe there is a need for a sustainable distribution system,” said Wylie Tollette, chief customer officer of Franklin Templeton Investments.

The sale of Januware began in the technical sector, where many companies could be affected by rising interest rates. The Federal Reserve has been sending hawkish signals in response to rising inflation. Last week Jay Powell, chair, showed that the first climb in March would be guaranteed, and he refused to stop the next fierce series.

Higher prices reduce the investment that investors have in future investments, hitting the prices of companies that advertise themselves to investors with promises of long-term growth. The Nasdaq Composite technical index fell by 9 percent, the worst decline for one month since November 2008.

As U.S. companies report their fourth-quarter results, growth in profits as well is expected to be delayed after last year, when he was encouraged and compared to a weak 2020.

Although investors have been trying to raise prices and reduce their monthly growth, the past few weeks have added another problem: war in Ukraine.

Geopolitical risks are well-known to be difficult to sell in the markets, but a number of investors have said rising tensions over the Russian uprising have helped spread the weakness from technology to a larger market in the second half of January.

“The situation in Ukraine is one that has led to a shift in focus to areas that are most affected by what can be traded,” said Tim Murray, a senior market analyst at T Rowe Price.

Even without war, long standing plus possible penalties in Russia could boost global energy prices at a time when the economy is already struggling to cope with rising prices.

Sebastian Raedler, chief of European equity strategy at the Bank of America, said “growing growth in Europe appears to be at high risk because electricity prices have risen sharply, which is expected to disrupt industrial activities”.

So far, European markets have performed slightly better than the US, down 3.8 percent since the beginning of the year. The FTSE All-World Index fell by 5.6 percent, its worst start since 2016, when markets were affected by China’s growing concerns.

When stocks began to fall, it was more difficult than ever to quit, according to Jack Caffey, JPMorgan Asset Management’s history manager.

Years of rising interest rates have caused supervisors to lose even a small amount of money, fearing that they will miss out on profits and criticism for their poor performance.

“Markets in the US have become a natural alternative – climbing is a powerful thing,” Caffey said. “We have robbed people of their ability to do things differently. . . the less money you make, the less likely you are to get it. ”

However, despite the difficulties, the economic downturn in the US seems to be doing well. Business growth is likely to slow down from last year’s peak, but it is expected to remain positive for many large companies, with investors looking for opportunities amidst volatility.

JPMorgan’s Caffey was one of the few high-tech companies that believed they could withstand rising prices and could benefit from long-term trends such as rising demand for semiconductors, rather than expanding their business in the short term.

Others including Murray at T Rowe Price said they focus on small companies with “good” stocks that have stable profits and strong sheets.

“Every time you find a really sharp market, you have some kids being thrown out of the bath water,” Murray said. “Of course there are others out there.”