The world's largest stock market just experienced its worst October in the past 5 years

The US stock market just experienced its worst October in the past 5 years, with the S&P 500 index down 5.3%, Dow Jones Industrial Average down 4.3% and Nasdaq Composite down 4.8%.

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This decline is driven by many factors, including inflation concerns, rising interest rates and global economic uncertainty.

The US stock market dropped sharply

The S&P 500 index, a measure of the performance of the 500 largest companies listed in the US, fell 5.3% in October, the biggest decline since October 2018.

The Dow Jones Industrial Average, a measure of the performance of the 30 largest companies listed in the US, fell 4.3% in October, the biggest decline since October 2011.

The Nasdaq Composite, a measure of the performance of major technology companies, fell 4.8% in October, its biggest decline since October 2018.

Inflation and interest rates increased

Inflation in the US remains at a record high, reaching 6.2% in September. This is the highest level in the past 30 years.

To curb inflation, the US Federal Reserve (Fed) raised the basic interest rate to 0.75%, the largest increase since 1994.

The basic interest rate is currently at 3.25%-3.5%. The Fed is expected to continue raising interest rates in the coming months.

Conclude

The US stock market is in a period of strong correction, due to concerns about inflation, rising interest rates and global economic instability.

Investors need to be cautious and consider carefully before making investment decisions.