Why the Dow fell 1,000 points in the last three days | CNN Business (2024)

FAQs

What caused the stock market to drop 1,000 points today? ›

The Dow shed more than 1,000 points after a turbulent day on Wall Street, with concerns about a slowing but stable U.S. economy rippling across global markets. The Dow closed more than 1,000 points lower and the other major U.S. stock indexes declined sharply today amid worries about slowing U.S. economic growth.

Dow plunges more than 1,000 points amid fears of U.S. economic slowdown. Stocks in the U.S. plunged for a third consecutive trading day, with the Dow Jones Industrial Average tumbling more than 1,000 points amid growing fears of an economic downturn sparked by a slowdown in hiring and consumer spending.

Global market drops can be attributed to the latest US jobs report showing unemployment "rising to its highest level in years", said The New York Times. The figures stoked fears the "economy was cooling", prompting a wave of "investor anxiety".

The Bottom Line

When the Dow gains or loses a point, it reflects the changes in the prices of the stocks in the index.

Put simply, investors sell their holdings in a bear market out of fear that stock prices will go down. No other reason is required. This is not the case in the Indian stock market today. Thus, we can conclude that as things stand at the time of writing, a bear market in 2024 doesn't seem likely.

A stock market collapse typically occurs when the economy is overheated, inflation is rising, market speculation is rampant, and there is significant uncertainty about the path of an economy.

The 1987 stock market crash, or Black Monday, is known for being the largest single-day percentage decline in U.S. stock market history. On Oct. 19, the Dow fell 22.6 percent, a shocking drop of 508 points. The crash was somewhat of an isolated incident and didn't have anywhere near the impact that the 1929 crash did.

October 19, 1987: Black Monday (-22.6%)

On October 19, 1987, a stock market crash in Hong Kong spread throughout the world, causing the Dow to fall over 22% in a single day. This historic day would be known as Black Monday and it is the most the Dow has ever declined in a single day since The Great Depression.

The average bear market has lasted only about 15 months, according to the Schwab Center for Financial Research, and 80% of corrections since 1974 have not led to a bear market. It remains to be seen whether the recent market volatility has reached its crescendo or whether the turbulence might continue.

Key Takeaways. While holding or moving to cash might feel good mentally and help avoid short-term stock market volatility, it is unlikely to be wise over the long term. Once you cash out a stock that's dropped in price, you move from a paper loss to an actual loss.

What is the stock market forecast for 2024? ›

Analysts project 11.5% earnings growth and 5.5% revenue growth for S&P 500 companies in 2024. Fortunately, analysts see positive earnings and revenue growth for all eleven market sectors this year.

Overall, Yardeni Research forecasts S&P 500 operating earnings at $250 in 2024, up 12% vs 2023. He puts them at $270 in 2025 (up 8%) and $300 in 2026 (up 11.1%). These figures compare with analysts' consensus forecasts of $244.70 in 2024, $279.70 in 2025 and $314.80 in 2026.

Stocks fell sharply Monday as worries about the U.S. economy sparked a world-wide sell-off. Market jitters that began with last week's weaker-than-expected jobs report spread to Europe and Asia, as investors worry that the world's largest economy — long a pillar of global growth — is beginning to show some cracks.

The Dow was recently down more than 900 points on Friday as a selloff continued. Off 2.3%, the blue-chip gauge was on track for its biggest daily drop since Sept. 13, 2022, according to Dow Jones Market Data. On that day in 2022, hotter-than-expected inflation data arrived to bulldoze stocks.

Dow closes more than 600 points down as stocks suffer worst day since early August meltdown. U.S. stocks finished sharply lower on Tuesday to kick off a historically tough month of the year for the market, as investors assessed weak manufacturing data that reignited concerns over an economic slowdown.

The sudden drop in stock prices may be influenced by economic conditions, catastrophic event(s), or speculative elements that sweep across the market. Most flash crashes are usually short bursts of market downturns that can last for a single day or much longer to bring investors heavy losses.

If a company's results surprise (are better than expected), the price jumps up. If a company's results disappoint (are worse than expected), then the price will fall.