October 2018 goes down as one of the worst months in the stock market since the Great Recession. The widespread market retreat across all sectors culminated into $1.91 trillion of losses to the S&P 500.
Despite October’s losses, Federal reserve Chairman Jerome Powell has indicated that the Fed intends to stay the course and continue making periodic rate increases. Mr. Powell further stated that there is no longer a need for “extremely accommodative low interest rates” that stemmed from the Credit Crises. Recent projections predict the Fed will raise the rates to 3.4% before pausing.
Facebook, Amazon, Apple, Netflix, and Google’s parent Alphabet (the “FAANG”) declined disproportionately to the rest of the market. Amazon ended the month down 20.2%, Netflix fell 19.3%, while Facebook and Alphabet ended October down 7.7% and 9.7%.
Since September, FAANG has lost $300 billion in market value.
