The stock market took quite a dismal hit on Christmas Eve but the turnaround may have already begun. If the rest of the market can recover the way the Dow Jones Industrial index has, perhaps things will reset by the New Year.
Indeed, the Dow Jones industrial average saw a 600 point gain on Wednesday, jumping almost 3 percent since the US markets plummeted on the worst Christmas Eve in history. Early in the day, the Dow Jones started on the negative side and cycled up 200 points in the first few hours of the day, on Wednesday. By the early afternoon, though, the trend continued, lifted mostly by surges in the blue-chip stocks (Apple, Home Depot, Microsoft, Nike, and Visa). And nearly 6 point surges in Amazon and Facebook also contributed.
This is important, of course, because Christmas Eve was a drastic day in the market, with the Dow falling 653 points. All indexes closed the day down at least 2 percent each. The Dow’s 30 blue chip stocks are down more than 13.63 percent—roughly 4,000 points—in the month of December, alone, which is almost 5,000 points down from its high in September.
As a matter of fact, all three of the major US stock indexes were amid a four-day losing streak. So the day after Christmas looked to break that trend. For example, both the Standard & Poor’s 500 and the tech-heavy Nasdaq Composite saw some pops, rebounding 2.9 percent and 3.7 percent, respectively.
The Christmas Eve trading day was a short one, but the day following Christmas saw the Nasdaq amid correction territory with the S&P very close as well. Actually, 10 of the 11 S&P sectors are within correction territory, Wednesday. A “correction” is basically defined as a 20 percent retreat from the most recent high.
But it is too early to say that the markets are correcting and revising upward. With uncertainty about the Fed—and how President Trump feels about the central bank—it certainly has, and will continue to, rattle the markets. With a growing global financial crisis and the US government shutdown underway, the markets are not swayed by the Fed’s continued confidence in US stability.