Ford, Bank of America, and Morgan Stanley are among the 120 S&P 500 stocks that have plunged over 20% since the end of July
Richard Drew/Associated Press
- As many as 120 S&P 500 stocks have tumbled by over 20% since the end of July.
- Investors' fears about higher interest rates and a bond-market crash have fueled the sell-off.
- Big names like Ford, Bank of American, and Morgan Stanley are among the stocks that have plunged.
Stocks' first-half rally has ground to a dramatic halt over the past three months – the sell-off has now entered bear-market territory for some of the US's best-known listed companies.
Ford, Bank of America, and Morgan Stanley are among the high-profile names that have dropped more than 20% since the S&P 500 hit its peak for the year on July 31.
The benchmark index has dropped 10% and 117 other stocks – including American Airlines, General Motors, 3M Company and Citigroup – have also shed at least one-fifth of their value over the same period.
Stocks started 2023 on an AI-powered tear, but have erased some of those gains in the second half with investors fretting that the Federal Reserve will keep interest rates high well into 2024 in a bid to kill off inflation, which is still lingering above the central bank's 2% target.
In recent weeks, a historic bond-market rout has also weighed on equities, with longer-duration US Treasury yields rising above 5% for the first time in 16 years. When debt yields are higher, stocks' relative appeal falls as investors pivot to lower-risk fixed-income assets.
Carmakers and banks aren't the only companies feeling the pain, either.
The so-called "Magnificent Seven" – consisting of Apple, Microsoft, Google owner Alphabet, Amazon, Nvidia, Facebook parent Meta Platforms, and Tesla – have shed an eye-popping $1.2 trillion in total market capitalization since the end of July, according to data from Refinitiv.