The S&P 500 fell 0.58%, placing it about 18% from its record high and on the brink of bear market territory Thursday. Photo by John Angelillo/UPI | License Photo
May 19 (UPI) -- The S&P 500 slid closer to bear market territory Thursday after falling for the second consecutive session.
The broad index fell 0.58% to 3,900.79 placing it about 18% off its record high set in January. An index is considered in a bear market when it falls 20% below a recent record high.
The tech-heavy Nasdaq Composite, already in a bear market, fell an additional 0.26% to 11,388.50.
Also Thursday, the blue-chip Dow Jones Industrial Average fell 236.94 points, or 0.75%.
Thursday's declines come on the heels of multi-week losing streaks for the Dow and S&P, followed by a brief rally Tuesday before the Dow fell 1,164.52, or 3.57% for its worst decline since 2020 on Wednesday.
"The main takeaway for investors is to brace for extended volatility," said Greg Bassuk, CEO of AXS Investments, according to CNBC. "We believe that volatility is going to be the investor narrative for the balance of Q2, and frankly, you know, for the balance of 2022."
Target stock continued to decline in the wake of weaker-than-expected corporate earnings, dropping 5.13% after sliding 25% on Wednesday.
Walmart stock also fell 2.74%, declining for the third straight day after reporting a significant earnings miss.
"Seemingly safe-haven stocks, the staples like Target and Walmart, are not immune," Cresset Capital CIO Jack Albin told Yahoo Finance. "Investors are looking at these stocks and thought that they were safe havens, and now we're seeing perhaps they weren't."
Tech bellwether Cisco plummeted 13.73% after reporting quarterly revenue that fell short of analysts' expectations on Wednesday and warning revenue was not on track to meet expectations in the current quarter.
Conversely, shares of Synopsys, rose 10.25% after the automation software company reported better than expected earnings, while cloud company Datadog rose 9.6% and Amazon and Nvidia both eked out gains.
Thursday's declines came amid ongoing concern that the Federal Reserve's interest rate hikes to combat inflation may tip the economy into a recession.
Fed Chairman Jerome Powell in remarks Wednesday that additional 50 basis-point interest rate hikes may be coming in future central bank policy meetings.
"Chairman Powell's hawkish comments yesterday afternoon and Target's shrinking profit margins this morning were too much for the market to handle," Independent Advisor Alliance CIO Chris Zaccarelli said in a note.
"Today's sell-off shows that growth fears are still gripping investors this year and the Fed doesn't have their back."