Analyzing the bear

By David Bukey
The Chinese calendar says 2008 is the Year of the Rat, but traders and investors are clearly enduring the Year of the Bear.

In January technology and small-cap stocks entered bear-market territory as the Nasdaq 100 (NDX) and Russell 2000 (RUT) indices slid 20 percent from their respective record highs on Oct. 31 and July 21, 2007. Although all major U.S. markets have fallen sharply in the last five months, the S&P 500 (SPX) and Dow Jones Industrial Average (DJIA) managed to avoid “official” bear-market status — a decline of 20 percent or more from a previous peak — during January’s swoon.



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