How Far Could the Stock Market Plunge? 1 Indicator Suggests We Could Be Near a Bottom

Let's face the ugly truth: It's been one of the most challenging years on record for Wall Street and the investing community. The benchmark S&P 500 (SNPINDEX: ^GSPC) delivered its worst first-half return in more than a half-century, while the growth-dependent Nasdaq Composite (NASDAQINDEX: ^IXIC) lost nearly a third of its value.

What could go wrong seemingly has. Global supply chains remain challenged by the COVID-19 pandemic and Russia's invasion of Ukraine, and the U.S. inflation rate hit yet another four-decade high of 9.1% in June. Whereas the Federal Reserve often comes to the rescue of tumbling equity markets, it now has no choice but to aggressively raise interest rates to tame inflation. It's a never-before-seen scenario that's led to a historically awful performance for equities.

But the big question remains: How far could the stock market plunge?

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Source Fool.com