Since the beginning of the year, the benchmark indexes have witnessed severe volatility due to the Fed’s upcoming rate hikes to reign in the multi-decade high inflation. In addition, the war in Ukraine has led to significant correction recently due to investors’ fears over global trade disruptions. The Dow Jones Industrial Average is down 8.4% year-to-date, while the S&P 500 and Nasdaq Composite have lost 11% and 18.2% year-to-date, respectively.
However, as the economy continues its recovery, growth stocks should perform well in the near term. Also, the recent correction has led to several growth stocks trading at attractive valuations. Moreover, the expected improvement in corporate earnings should support the performance of growth stocks. According to a FactSet report, the S&P 500 is expected to report earnings growth of 9% year-over-year in 2022.
