“Seen through the lens of human perception, cycles are often viewed as less symmetrical than they are. Negative price fluctuations are called “volatility,” while positive price fluctuations are called “profit.” Collapsing markets are called “selling panics,” while surges receive more benign descriptions (but I think they may best be seen as “buying panics”; see tech stocks in 1999, for example). Commentators talk about “investor capitulation” at the bottom of market cycles, while I also see capitulation at the top, when previously prudent investors throw in the towel and buy.” ― Howard Marks

1. 10-Year Treasury Yield Hits 3% for First Time Since 2018 — the yield on the benchmark 10-year Treasury note, which rises when bond prices fall, surged at the start of U.S. trading and reached as high as 3.008% in the afternoon, as traders braced for the outcome of this week’s Federal Reserve meeting. Yields on Treasurys largely reflect investors’ expectations for short-term interest rates over the life of a bond. Rising yields are often associated with a strengthening economy because faster growth and a tighter labor market can lead central banks to crack down on inflation.
2. Fed Lifts Rates by Half Point in Biggest Hike Since 2000 — the Federal Reserve approved a rare half-percentage-point interest rate increase and announced plans to shrink its $9 trillion asset portfolio starting next month in a double-barreled effort to reduce inflation that is running at a four-decade high. The moves, announced after a two-day policy meeting Wednesday, will raise the central bank’s benchmark federal-funds rate to a target range between 0.75% and 1%.
Together, the steps mark the most aggressive Fed tightening of monetary policy at one meeting in decades, aimed at rapidly reducing the economic stimulus that has contributed to rising price pressures. The Fed, which usually lifts interest rates in quarter-percentage-point increments, last raised rates by a half point in 2000.
3. U.S. Mortgage Rates Jump to 5.37%, Highest Since 2009 — The average for a 30-year loan jumped to 5.27% from 5.10% last week, Freddie Mac said in a statement Thursday. The Federal Reserve yesterday raised its benchmark rate by a half point, the biggest bump since 2000, and signaled further hikes to come in its effort to cool inflation and the overheated housing market. Higher mortgage costs — already up more than 2 percentage points this year — may increasingly push out would-be homebuyers and ease competition for a scarce supply of listings. At the current 30-year average, a borrower with a $300,000 mortgage would pay $1,660 a month, $377 more than at the end of last year.
4. Bitcoin Slides Below $37,000 as Investors Unwind Risky Bets — apart from a brief selloff in January, bitcoin’s price hasn’t been this low since last July, when it traded as low as $29,000. The largest cryptocurrency is now down about 47% from its November record high of $68,991. On Wednesday, the central bank announced a half-point rate increase. Fed Chairman Jerome Powell said there may be half-point rate increases in the summer months, but that officials aren’t considering a three-fourths of a percentage point increase. The widespread unwinding of risk assets has hit the cryptocurrency market particularly hard, driving down everything from bitcoin to NFTs. It has also started to have an effect on companies in the industry. Crypto companies were surging early in the year, capped when several paid millions of dollars to run ads during the Super Bowl. But the momentum has faded sharply since then.
5. Past Bear Market Statistics — based on a BAC ‘s strategist Michael Harnett, Looking at a history of 19 bear markets over the past 140 years, they found the average price decline was 37.3% and the average duration about 289 days. While “past performance is no guide to future performance,” Hartnett and the team say the current bear market would end Oct. 19 of this year, with the S&P 500 at 3,000 and the Nasdaq Composite at 10,000. Check out their chart below:

The week ahead — Economic data from Econoday.com: