Stocks are in a bear market: Sometimes it's helpful to zoom out

6/14/22 8:00PM

The bears are coming‍

US stocks are officially in a bear market, with the S&P 500 Index closing down 22% below its previous peak yesterday as investors sold stocks for any number of valid concerns.

As we've discussed previously, the tech-heavy NASDAQ and other market trackers had already breached the 20% decline threshold, but this is the first time the broader S&P 500 Index has done so... at least since March 2020.

‍Zooming out

‍A 22% fall in the value of stocks in a little over 6 months isn't really good news for anyone, but sometimes it's helpful to zoom out and get some perspective. Looking back 18 months shows that the index is basically back to where it was at the start of 2021, which isn't too terrifying, and on a really long horizon this latest crash looks a lot like the crashes that have come before it, all of which eventually saw the market recover and move higher.

Among a long list of valid concerns, inflation (and the Fed's response to fight it) is probably number one, which is why all eyes are on today's interest-rate decision where investors are expecting a 0.75% rate hike — which would be the biggest move upward for 28 years.

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JetBlue is raising its bag fees as fuel costs squeeze airlines

JetBlue will reportedly hike its bag fees, as the cost of jet fuel continues to climb amid the war in Iran. It’s the latest example of carriers finding ways to push rising costs onto travelers.

Last week, United Airlines CEO Scott Kirby said that if fuel prices remain elevated, fares would need to rise another 20% for his airline to break even this year.

As CNBC reported, when one airline raises fees, others tend to follow.

Earlier this month, JetBlue hiked its first-quarter outlook for operating revenue per seat mile to between 5% and 7%, saying that strong Q1 demand helped “partially offset additional expenses realized from operational disruptions and rising fuel costs.” Now, the carrier appears to be making moves to further boost revenue to offset those costs.

Earlier on Monday, JetBlue rival Alaska Air lowered its Q1 profit forecast. The refining margins for the carrier’s cheapest fuel option — sourced from Singapore and representing about 20% of Alaska’s overall supply — have spiked 400% since February.

JetBlue did not immediately respond to a request for comment.