Wall Street has long relied on a simple rule to define a bear market: a decline of 20% or more from a recent peak in a major stock index. But the sharp swings in technology and semiconductor stocks are challenging whether that measure still adequately captures market conditions.
The Philadelphia SE Semiconductor Index, a key benchmark for chip stocks, and South Korea's tech-heavy KOSPI both entered bear-market territory in July under the traditional definition. Yet at their respective lows, the indexes were still up about 46% and 25% for the year, following triple-digit gains over the preceding 12 months.
