On Thursday, the Dow Jones industrial average (INDU) experienced it’s largest point decline in trade ever, dropping almost 1,000 points. While it managed to recover some and close at a still-down 348 points, we were left with the worst percentage decline for the Dow since April 2009 – not the best news for investment accounts.
Drop Follows Winning Streak; Glitch and Europe to Blame
At the end of April, we reported that stocks across the board had risen eight weeks straight, which was the best streak seen in six years. But while investment firms began predicting that the streak wouldn’t last another week, no one could have seen what forced the stocks downward.
According to published reports, fears about the spread of the European debt crisis already played a role in a small drop in stocks in the morning. But by around 2:40 ET, selling picked up in intensity due some technical glitches.
As a result, the Dow dropped severely and then closed at a disappointing 10520.32, leaving companies like Procter & Gamble to suffer the most with a 37 percent drop in investments from $62.12 per share to close to $39.37. Luckily, it was also able to recover most of that loss.
Problems Could Still Lurk for Stock Market
While some predict that the worst of the stock market plunge may be over – and by Friday morning, Dow, S&P and Nasdaq futures were all higher – David Jones, chief market strategist at IG Markets in London told CNN that the possibility of Greek chaos spreading across the continent “is a still big cloud hanging over Europe.”
Investors are hoping for a recovery that will continue for days and weeks, but so far, the odds don’t look to be in their favor.