Record high consumer costs, rising interest rates and international unrest continue to drive investors out of many business stocks and into the perceived safe haven of government bonds, fueling further market declines.

The major U.S. stock indexes were all down at the close of regular trading on Thursday following highly volatile activity on Wednesday and are collectively inching closer to the technical definition of a bear market period, the first since the onset of COVID-19.

What’s happening? The S&P 500 lost .6% on Thursday and is now down 18.7% from the record high it set early this year, nearly at the 20% threshold that defines a bear market. Investors are worrying that the soaring inflation that’s hurting people shopping for groceries and filling their cars up is also walloping profits at U.S. companies. Target fell again, a day after losing a quarter of its value on a surprisingly large drop in earnings.

The Nasdaq is already in a bear market, down 29.1% from its peak of 16,057.44 on Nov. 19. The Dow Jones Industrial Average is more than 15% below its most recent peak.

The most recent bear market for the S&P 500 ran from Feb. 19, 2020, through March 23, 2020. The index fell 34% in that one-month period. It’s the shortest bear market ever.

Rising interest rates, high inflation, the war in Ukraine and a slowdown in China’s economy have caused investors to reconsider the prices they’re willing to pay for a wide range of stocks, from high-flying tech companies to traditional automakers.

Are we headed to a recession? Earnings reports from some of America’s biggest retailers in recent days have added to concern that the highest rate of inflation in four decades is catching up with U.S. consumers and pitching the economy toward a recession, according to a Wall Street Journal report. Investors were already grappling with the end of an era of loose monetary policy that stoked big gains for stocks and other riskier assets.

Per the Journal, the combination of factors has recently fed into steep losses for stocks and some corporate bonds, and many investors expect the volatility to continue.

“The price action suggests it’s not over,” said Philip Saunders, a portfolio manager at Ninety One, an asset manager based in the U.K. and South Africa.

Critics said the overall stock market came into the year looking pricey versus history. Big technology stocks and other winners of the pandemic were seen as the most expensive, and those stocks have been the most punished as rates have risen.

Stocks have declined almost 35% on average when a bear market coincides with a recession, compared with a nearly 24% drop when the economy avoids a recession, according to Ryan Detrick, chief market strategist at LPL Financial.

Why bears and bulls? Bears hibernate and bulls charge.

Per CNBC, a bear market is when stock prices fall and a bull market is when prices go up. It’s easy to interpret the two terms as they are essentially opposites of one another. During a bear market, which is a steep drop in stock prices, you’ll typically also see low investor confidence and a perception that the market is risky. In a bull market, which is a continued rise in stock prices, you’ll likely see high investor confidence and a perception that there’s a strong economic environment.

More specifically, however, a bear market describes any stock index or individual stock that drops 20% or more from its recent highs. A bull market, on the other hand, typically rises 20% from recent bear market lows and reaches record benchmark highs.

Contributing: Associated Press