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The stock market is on sale. That doesn’t make it cheap

4 min read James Mackintosh 21 Jul 2022, 05:08 PM IST

Valuations have plummeted at a record rate, but that’s before Wall Street has taken account of a slowing profit growth

Almost the entire fall in stocks up to early June was due to the effect of rising rates on valuations of expected earnings. (Photo: AP) — Almost the entire fall in stocks up to early June was due to the effect of rising rates on valuations of expected earnings. **(Photo: AP)**

The valuation of the U.S. stock market has fallen faster than in the aftermath of the dot-com crash, recording the biggest six, 12 and 18-month drops since data on price-to-forward-earnings ratios began in 1985. That should be only a slight consolation to investors.