The markets have been going through a roller coaster ride this week, and it’s only Tuesday. The volatility and the sharp swings are expected because of the uncertainty in the global economy and the trade war between China and the United States. With the new market developments, investors and traders are trying to understand if these are temporary corrections or the start of a new trend. In this blog post, you’ll learn the top things you need to know about the markets.
Table of Contents
What is the Dow Jones Index
The Dow Jones today trades at $34,411. From January 26 to February 4, the index lost over 4,000 points or over 6.5%. On February 5, the Dow dropped over 790 points, the largest one-day point drop in the index’s history. This sharp drop took the index below the critical 25,000 mark for the first time since January 26.
The Dow Jones Industrial Average is a price-weighted average of 30 large publicly traded companies based in the United States. It was created in 1896 by Charles H. Dow and Edward A. Allen to gauge the overall state of the U.S. economy.
Each member of the index is chosen based on its contribution to the rest of the index. It is calculated by looking at the price of the 30 stocks in the index and dividing it by the total market value of all stocks on the NYSE. The market value is taken as the total value of all stocks on the exchange, not including listed stocks.
What You Need To Know About the Nasdaq
The Nasdaq is an index that tracks the performance of technology companies. It is often compared to the NASDAQ, which tracks the performance of companies in the retail sector. It was created in 1971 to give investors a way to compare the relative performance of stocks in different sectors. With the rise of technology stocks, the Nasdaq became more popular than the NASDAQ. Originally, it was simply an average of the prices of the NASDAQ’s 30 members. But in 1999, the Nasdaq expanded to include companies listed on the NYSE.
What’s Happening With The S&P 500
The S&P 500 is an index that tracks the performance of the largest 500 companies in the U.S. stock market. It’s a broad market indicator that shows the health of the economy. From a high of 2,872 on February 6, the S&P 500 declined to 2,788 on February 10 and then rebounded to 3,011 on February 14. After that, the index declined again and hit its low on February 20 of 2,749. Then, the index recovered some of its losses and rose to 2,867 by February 24.
Bottom Line
The stock market has been fluctuating a lot this week. And the sharp drops that take the Dow Jones Industrial Average down 7.5% or more are the most common thing you hear about. If you’re wondering if it’s safe to invest your money in the stock market, you should know that the volatility is normal. There are a lot of factors that can affect the market, including economic factors and interest rates. So it’s always best to do your research and invest wisely.
