U.S. stock indexes had a mixed Tuesday, a day after the S&P 500 slid into a bear market on fears that red-hot inflation will prompt more aggressive rate increases from the Federal Reserve.
The S&P 500 fell about 0.4% on Tuesday, while the Dow industrials were down 0.5%. The tech-focused Nasdaq Composite was up 0.2%.
Cryptocurrencies continued to drop, with bitcoin falling further below $23,000 as investors dumped their most speculative holdings.
All eyes this week will be on the Fed's interest-rate decision on Wednesday, with officials considering a larger-than-expected 0.75-percentage-point increase.
Nasdaq and the S&P 500 are in a bear market, defined as a decline of at least 20% from their highs.
Many investors contend that the worst in markets might soon be over, given the extended declines in many market sectors this year and the generally healthy state of the U.S. economy.
They say buying the dip has fallen out of favor during this year’s rout but that negative sentiment is often a precursor to an extended rebound.
Even with the S&P 500 down 22% in 2022, many investors and analysts fear that stock-market valuations have further to fall.
The S&P 500 traded Monday at 15.8 times its projected earnings over the next 12 months, according to FactSet, still above the 15-year average of 15.7.