May 19, 2022, 11:18 am EDT
Watch out for Coming Troubles
It does not happen often such coming financial troubles since the last bear market 13 years ago. After brutal attacks on four major retailers: Walmart (WMT), Target (TGT), Costco (COST), and Dollar Tree (DLTR) today the nightmare arrives on the railroad industry: UPN, CSX, NSC -5%. Please note that these companies are the strongest leaders until April 2022. The stock markets wipe out even defensive stocks in consumer staples and transport. It means that the coming troubles could be significant in magnitude and scope.
Also, the network equipment maker Cisco (CSCO) tumbled by 13% after the earnings report. This kind of breakdown is rare for such a mature company with consistent earnings results.
It is the same situation that you need to roll back 35 years of history to see Walmart (WMT), and Target (TGT) crash this way.
Here is the Year-To-Date (YTD) performance for the major indexes:
- Dow Jones: -14%
- S&P 500: -18%
- Nasdaq: -27%
According to the conventional definition of a bear market that is down -20% from the recent high, only the Nasdaq index is in the bear market. In other words, the major decline has not been started yet. However, the stock markets already surprised most of us with these unusual behaviors.
Therefore, we should be reminded and prepared for the coming troubles.