At the end of March, the S&P 500 was down 5%

May 10, 2022

At the end of March, the S&P 500 was down 5% for the year, but the market had been higher in April for the last 9 years.  We knew quarterly earnings were going to play a big role in stock market movement in April but using history as our guide we expected to see better stock market performance during the month.  We did not expect recession fears to grip the market and send the S&P 500 down every week in April for its worst monthly performance since March of 2020.  The Chinese economy is struggling under their suffocating Covid restrictions, the U.S. is dealing with rising interest rates and high gasoline price and Europe is wrestling with the war in Ukraine.  Corporate earnings have thus far been a mixed bag, but lower guidance due to all the uncertainty has become more common.  In December the market was expecting the economic reopen to gain strength, but the various head winds have slowed that reopening.  Most think talk of recession is premature, but it became a pervasive theme during the month.  At the end of the month the S&P 500 had dropped 8.8%, its worst month since March 2020 and is now 13.3% lower for the year.  Oil gained 5.6%, the rate on the 10-year Treasury moved up 24% to the highest level in 3½ years but gold was down 1.8%.

Interest rates were in focus as we opened the month.  The interest rate on the 10-year Treasury moved above 2.5%, rising 40% in just 30 days, and that weighed on the market, sending the S&P 500 down 1% at the end of the first full week of trading.  The selling continued into the 2nd week as interest rates continued to rise and we learned inflation in March was 8.5%, the highest in 41 years.  The holiday shortened week ended with the S&P 500 losing another 2.1%.  The 3rd week saw a rebound attempt fail mid-day on Thursday sending the Dow down 370 points on Thursday and another 980 points on Friday. The rate on the 10-year Treasury got within a tick of 3%, a rate not seen since 2018, and that continued to weigh on stocks.   Friday was the worst day for the Dow Industrial average since 2020 and helped drive the S&P 500 to a 2.7% loss for the week.  The last week was very volatile with a nearly 3% selloff on Tuesday followed by a more than 2% rally on Thursday before a 3.6% selloff on Friday taking the loss for the week to 3.3%.

May is one of only two months that have, on average, closed lower.  However, we learned in April that history is just a guide and certainly not an absolute.  The market is facing numerous headwinds that we mentioned above, but with the news backdrop bleak there is increasing chances for positive surprises.  China’s Covid issues could abate, the supply chain issues could ease, the chip shortage could improve, interest rates and oil prices could decline, we could get better inflation numbers, international travel could pick up and the war in Ukraine could take a positive turn.  Our point?  There is plenty to worry about, but there is substantial opportunity for things to improve.  The stock market has been trading about 20% above historic norms on hopes for the global economic reopening.  We believe that has been postponed, not cancelled.  Prices of many stocks have declined by 25% to 50% so opportunities are improving.

If you know someone who would be interested in learning more about Greenberg Financial Group, please contact us at 520-544-4909, or visit our NEW website at As always, the key to successful investing is to have a portfolio that is consistent with your investment objectives and risk tolerance. We invite you to listen to our weekly Money Matters radio show which airs every Sunday Morning from 8:00 AM to 10:00 AM on KNST AM 790.  You can also listen to us on iHeart radio, follow us on Twitter @gbergfinancial or on Facebook under Greenberg Financial Group.  You can now listen to previous shows by going to or using the iHeart app.


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