The upward move will not be easy, but there are growing signs that the stock market has already bottomed out.
It is down 17% from its all-time high of 4,796 in early January. It had fallen 25% to its low for the year at 3,577, which came in early October. One of the main drivers was that the Federal Reserve raised interest rates to fight high inflation by reducing economic demand. This is even when inflation had already started to dent consumer demand. Additionally, fast-growing tech companies have seen their valuations, or the expected earnings multiples of their stocks, rise in part because higher rates make future earnings less valuable. These companies expect a large portion of their profits to flow in the coming years.
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