2022 Stock Market Correction: Worse Than the Pandemic?

    The latest buzz on Wall Street is that the S&P 500 will see a stock market correction worse than the pandemic. Like the 2020 stock market correction, when the S&P 500 fell more than 35% in a matter of weeks, which appear to be a possibility again.

    The outward explanation is the conflict in Ukraine, but the main reason for the stock market’s decline is the same. Earnings expectations are set to undergo a systemic revaluation, and that can only mean stocks are grossly overpriced and stock market correction is coming. The market is bloated by stimulus money and unmet expectations, and it may fall back to the long-term trend line close to 2,700.

    Stock Market Graphs
    Stock Market Graphs

    Stock market correction definition

    A correction in the stock market, also known as a pullback, occurs when the stock market drops 10% from its 52-week high price. In 2022 stock market correction is common, and every bull market ends in a stock market correction, which has been the case for the past 40 years. Experienced investors always welcome a stock market correction in 2022 because it allows the market to stabilize before reaching new highs.

    Oil drives inflation; the S&P 500 leave Russia

    Petroleum Prices
    Petroleum Prices

    Many S&P 500 businesses are exiting or shutting down their Russian operations. The message here is that before the conflict, the expectation for profit growth in Q1 and FY 2022 was modest and was beginning to drop. Consensus expectations aren’t high either and could dip below 0%. In such a case, recession comes into play, which isn’t suitable for the market.

    Oil and gas prices are rising due to tighter global capacity. Even if WTI and gasoline stabilize at present levels, they are almost 200% higher than last year’s levels and are expected to stay high for the foreseeable future. This means a tighter margin in Q1 and FY period than initially predicted, lower earnings than planned, and the economy’s potential stagnating. That will reduce discretionary spending, which is terrible news for S&P 500 earnings.

    Petroleum Stocks Market Prices Graphs
    Petroleum Stocks Market Prices Graphs

    Final thoughts on stock market correction

    The S&P 500 is a short-term stock market correction that may turn positive. The market has broken through bullish support at the 4,300 level, and now the near 4,200 target is also under pressure. If support holds and news improves, the S&P 500 could rise to 4,400, where strong resistance is anticipated.

    Price action is projected to go below 4,200 in the long run, testing support at 4101.75, the current movement’s lowest low. If that level doesn’t hold, substantial support will be found at 4,000 and then 4,800. 



    RELATED ARTICLES

    How to Steer Clear of Wrongful Trading Allegations as a Director

    How to Steer Clear of Wrongful Trading Allegations as a Director

    Introduction Operating a company is fraught with great responsibilities, particularly when the company is financially troubled....
    EGERP Panipat

    EGERP Panipat: Helping Business’ Automate and Grow Properly!

    Technology is rising, and with time, everything is getting on the rise. This is why...
    Elevating Your Approach in a Competitive Landscape

    Elevating Your Approach in a Competitive Landscape

    Remaining ahead of the competition requires more than just staying current—it involves proactive thinking, agile...
    How to Choose the Right Business Structure for

    How to Choose the Right Business Structure for Legal Protection

    Most new business owners think about products, customers, and marketing first. Legal structure? That part...
    Chef Recruitment Services

    How Chef Recruitment Services Help Restaurants Find the Best Talent

    Restaurants success hangs on the ability of one single thing: culinary staff, but most of...
    IT Equipment for Your Business

    Benefits of Buying Refurbished IT Equipment for Your Business

    As an entrepreneur, do you strive to make your workplace buzz with productivity? Do you...
    crypto 30x.com

    Crypto30x.Com: Multiply Your Crypto Profits!

    crypto30x.com in 2025: where do we go from here? It's the question buzzing in every...
    censure meaning in Congress

    Censure Meaning in Congress: What Does It Mean To Be Censured?

    Censure Meaning in Congress can be a confusing concept for many. The issue is, how...
    chipotle honey chicken

    Chipotle Honey Chicken: Sweet, Spicy & Smoky Delight

    Chicken dishes are a staple in many families, supplying versatility, flavor, and ease of guidance....
    Wellhealthorganic.Com effective natural beauty tips

    Well Health Organic Skin Care: Effective Natural Beauty Tips

    Today, one of the challenges in this fast world is caring for glowing, beautiful skin....
    School Spirits Season 3

    School Spirits Season 3: Is the Paranormal Mystery back

    School Spirits is a well-loved show that blends high school drama with ghost stories, creating...