CNN :
There hasn’t been a bear market in the U.S. since the Great Recession. And even after the atrocious start to 2016, Wall Street isn’t close to a bear market. The major indexes have to plunge 20% below their previous high to be in one.
The S&P 500 is down about 9% from its record highs of last year. The Dow and Nasdaq were down 10% from the highs on Thursday, officially falling into “correction” mode.
But lurking beneath the surface, the picture looks a lot worse. As of Friday nearly half — or 229 — of the stocks in the S&P 500 have crumbled at least 20% below their 52-week highs, according to FactSet data.
They include stocks rocked by the oil crash like Chesapeake Energy (CHK) (down a stunning 77% from its high) as well as better-known names like FedEx (FDX), Goldman Sachs (GS) and Priceline (PCLN, Tech30).
Some may see this as a warning sign about the broader market. After all, even Netflix (NFLX, Tech30) can only prop up the rest of the market by itself for so long. (No offense Frank Underwood.)
“So many things are breaking down that the chance of the overall market breaking down is higher than at any time in several years,” said Ryan Detrick, an independent market strategist.
Related: What’s driving the global market freakout…in 2 minutes
So why aren’t the broader indexes reflecting the underlying pain? First, Netflix and other beloved stocks like Facebook (FB, Tech30) and Googl (GOOGL, Tech30)e have held up better than the rest of the market. That counts for a lot considering those three companies are now worth a stunning $831 billion.
But look at the signs of weakness in the broader S&P 1500, which includes small, medium and large-cap companies. The average stock in that index is down 25% from its high as of Friday, according to Bespoke Investment Group.
There hasn’t been a bear market in the U.S. since the Great Recession. And even after the atrocious start to 2016, Wall Street isn’t close to a bear market. The major indexes have to plunge 20% below their previous high to be in one.
The S&P 500 is down about 9% from its record highs of last year. The Dow and Nasdaq were down 10% from the highs on Thursday, officially falling into “correction” mode.
But lurking beneath the surface, the picture looks a lot worse. As of Friday nearly half — or 229 — of the stocks in the S&P 500 have crumbled at least 20% below their 52-week highs, according to FactSet data.
They include stocks rocked by the oil crash like Chesapeake Energy (CHK) (down a stunning 77% from its high) as well as better-known names like FedEx (FDX), Goldman Sachs (GS) and Priceline (PCLN, Tech30).
Some may see this as a warning sign about the broader market. After all, even Netflix (NFLX, Tech30) can only prop up the rest of the market by itself for so long. (No offense Frank Underwood.)
“So many things are breaking down that the chance of the overall market breaking down is higher than at any time in several years,” said Ryan Detrick, an independent market strategist.
Related: What’s driving the global market freakout…in 2 minutes
So why aren’t the broader indexes reflecting the underlying pain? First, Netflix and other beloved stocks like Facebook (FB, Tech30) and Googl (GOOGL, Tech30)e have held up better than the rest of the market. That counts for a lot considering those three companies are now worth a stunning $831 billion.
But look at the signs of weakness in the broader S&P 1500, which includes small, medium and large-cap companies. The average stock in that index is down 25% from its high as of Friday, according to Bespoke Investment Group.
