Worst half year for U.S. stock market s in fifty years

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U.S. stock market – Stock market indices in the United States closed an extraordinarily bad six months on Thursday. For example, the Dow Jones Industrial Average lost more than 15 percent in the past six months and the S&P 500 even more than 20 percent. These were the largest decreases in more than fifty and sixty years respectively. The Dutch AEX also shrank in the first half of the year, by more than 17 percent.

In addition to the Amsterdam stock market gauge, other European stock market indices have also not done well. For example, britain’s FTSE lost 20 percent in the past six months, while the Stoxx 600 – an index of stocks from seventeen European countries – recorded a loss of 17 percent, BBC News reports.

The fact that stock markets have done poorly in recent times is mainly due to interest rate hikes by central banks in the US and Europe.

The banks have already raised their interest rates or have announced that they will, in order to keep inflation in check.

Prices of goods and services have risen sharply in recent months. Raising interest rates can counteract this, because consumers are then more inclined to save.

But if saving is more attractive, less is invested, causing prices to fall.

U.S. stock market s in fifty years

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