[Glossary] US Stock Market Enters Bear Market... What Does 'Bear Market' Mean?

[Image source=Yonhap News]

[Asia Economy Reporter Eunmo Koo] A Bear Market refers to a bearish market where stock prices and asset prices are falling or expected to fall. The term originates from the bear's fighting posture of striking downward. Conversely, a prolonged rise in stock prices or a bullish market is called a Bull Market, likened to a bull.

Generally, when stock prices fall more than 20% compared to the previous peak, it is said to have entered a Bear Market. The term can refer to the market itself where prices are declining or be used when there is a high possibility of entering a long-term downtrend. Therefore, entering a Bear Market can be interpreted as a sign that investor sentiment has weakened and volatility has increased.