Nasdaq Drops More Than 6% as Oil, Inflation and AI Spending Jolt Indexes
Updated
Updated · The Motley Fool · Aug 5
Nasdaq Drops More Than 6% as Oil, Inflation and AI Spending Jolt Indexes
3 articles · Updated · The Motley Fool · Aug 5
Summary
More than 6% of Nasdaq value and over 1.25% of the S&P 500 have been erased since early June as investors confront higher oil prices, sticky inflation and worries over AI spending.
Those headwinds have not produced a clear recession signal, and the report argues short-term volatility is too unpredictable to time reliably.
A June 2023 Deutsche Bank call for a near-100% recession chance missed a market that then sent the S&P 500 up more than 76%, underscoring the risk of stepping aside.
History also favors staying invested: an S&P 500 ETF bought in January 2008 still delivered 126% total returns over the following decade despite the Great Recession crash.
The broader takeaway is that downturns are inevitable but recoveries have followed every crash, leaving long-term investors better served by continuing to buy quality stocks.