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As investors were more anxious that increased energy costs due to the Russia-Ukraine war would slow the economy and create inflation, stocks dropped again on Monday, capping a string of four consecutive weeks of falls.
As a result of an almost 8% drop in American Express’s stock price, the Dow Jones Industrial Average dropped 797.42 points to settle at 32,817.38. After plunging over 3 percent to 4,201.09, the S& P 500 entered correction territory for the first time in nearly two years. The S& P 500 index is more than 12 percent away from its all-time high closing on Friday. To end at 12,830.96, the Nasdaq Composite fell 3.6 percent, putting it in the bear market territory, having fallen more than 20 percent from its all-time closing high.
As the Russian-Ukrainian conflict continues, investors watch the possible economic repercussions of interruptions in the global energy supply, which may have serious consequences.
The Leuthold Group’s chief investment strategist, Jim Paulsen, said that as a result, “stagflation” is quickly becoming the core emphasis of portfolio strategies. “Investors’ anxieties and actions are being driven by the prospect of weaker GDP and higher inflation for the foreseeable future.”