Stocks suffered their fifth straight week of losses as interest rate and inflation worries weighed heavily on market sentiment, hitting growth stocks particularly hard. The Dow joined the S&P 500 and S&P Midcap in correction territory, while the NASDAQ and Russell 2000 Smallcap indices sit firmly in bear territory, down more than 25%. Markets have been extremely volatile, although the VIX remains below intraday levels reached back in January.
The S&P 500 Index of U.S. large-cap stocks fell to its lowest level in 2022. Despite strong earnings from bellwethers such as Apple, Microsoft, and Meta Platforms, Amazon's earnings disappointed, posting its first quarterly loss since 2015 and sending its shares down 14%.
The major U.S. market indices ended lower last week, with Value outpacing Growth and Large Caps trailing their smaller-cap peers, thanks in part to Netflix's 35% implosion on global subscription losses. More importantly, it was revealed that everyone on the planet is using the same username and password (hyperbole, but it's a problem nonetheless).
Most of the big players in the ETF industry were in Miami last week for Exchange: The ETF Experience Conference at the Fontainebleau. There were some great sessions and it was nice to see colleagues in person again. Not too many masks, but lots of hand sanitizer for the vaxed or negative testing crowd. I will recap some of the highlights below, but first here's a brief recap of the market week.
As investors brace for rate hikes, market action was choppy last week. Defensive sectors such as consumer staples and healthcare recorded solid gains, while technology, communication services, and consumer discretionary sold off. One tech outlier was the shares of Twitter which soared 27% last Monday on news that Elon Musk acquired a 9.2% stake in the company.
The S&P 500 closed out its best month since December, but still posted its first negative quarter in two years, down 4.6% on a total return basis. That was still better than the bond market, which experienced its worst quarter in 40 years.