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The Dow falls greater than 200 factors because the worst market sell-off since March 2020 continues

The market is in for a roller coaster week as the S&P 500 heads for its worst month since March 2020.

The Dow Jones Industrial Average fell about 250 points, or 0.7%. The S&P 500 fell 0.5%. The Nasdaq Composite fell 0.4%.

Major moving averages have seen outsized swings every day this week — including the Dow, which turned to an intraday deficit of more than 1,000 points to close higher on Monday for the first time ever.

High, low, and Conclude Levels for the Dow Jones Industrial Average

Graphic: Nate Rattner/CNBC

Source: FactSet. As of January 27, 2022.

High, low, and Conclude levels for the Dow

Jones industry average

Graphic: Nate Rattner/CNBC

Source: FactSet. As of January 27, 2022.

High, low, and Conclude Levels for the Dow Jones Industrial Average

Graphic: Nate Rattner/CNBC

Source: FactSet. As of January 27, 2022.

The Dow and S&P 500 are both heading for four consecutive weeks of losses. The Nasdaq Composite is down 3% this week and is on course for its fifth consecutive negative week.

The S&P 500 closed Thursday down 9.8% from its record close on Jan. 3. The Nasdaq is deep in correction territory, more than 17% below its intraday high.

The Russell 2000, the small-cap benchmark, is in a bear market and ended Thursday down 20.9% from its record close.

With January ending on Monday, the tech-heavy Nasdaq is heading for its worst month since October 2008 and worst first month of the year on record. The S&P 500 faces its weakest month since March 2020 and weakest January on record. The Dow could have its worst month since March 2020 and its worst January since 2009.

The market's fear gauge, the Cboe Volatility Index, shot to its highest level since October 2020 earlier this week, trading above 30.

Investors continued to digest the US Federal Reserve's shift towards tighter policy.

The Federal Open Market Committee on Wednesday indicated that it is likely to raise interest rates for the first time in more than three years as part of a broader tightening of historically easy monetary policy. Markets are now pricing in five quarter-point rate hikes in 2022, even though long-term interest rate expectations have changed little.

"The FOMC meeting brought no surprises in terms of monetary policy, but it could be perceived as more hawkish than expected as Chair Powell has indicated that there is a need to move into a 'steady' phase of monetary policy normalization," Chris said Hussey, a managing director at Goldman Sachs, said in a note.

Stock picks and investment trends from CNBC Pro:

Apple's shares rose more than 3% after the company reported its best-ever single quarter of sales, even amid supply issues and the ongoing impact of the pandemic. Apple beat analyst estimates for sales in every product category except iPads.

Chevron shares fell about 3% after missing Wall Street's earnings expectations. Dow component Caterpillar fell more than 3% even after beating earnings estimates.

The December personal consumption spending index, the Fed's preferred indicator of inflation, rose 4.9% from a year earlier, the Commerce Department reported on Friday. The PCE jump is higher than economists were expecting and the hottest reading since September 1983. Coupled with the inflation numbers, personal income rose 0.3% for the month, slightly less than the 0.4% estimate.

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