The US stock exchange: an infamous game of chance and strategy where you place your money in the hands of corporations with hopes of getting lucky and ending up rich. In the last few months of 2018, however, it seemed the whims of luck were on no one’s side.
The months of October, November, and December were all characterized by severe drops in the Dow Jones Industrial Average otherwise known as the Dow (there are quite a few other indexes but Dow continues to serve as one of the most popular.) The Dow is created by tracking a weighted mean of the 30 largest corporations’ stock price trends. A stock index like the Dow, regardless of the specific type, is often looked to as a gauge for the general health of the stock market.
Many news and media outlets in the early months of 2018 started reporting a negative outlook for the end of the year. Some sources even made bold claims that 2018 would bring the worst crash in the history of the United States. Fortunately for Americans, the stock market did not crash. Nevertheless, it was not in a favorable place.
The beginning of the large decline in stock prices can be traced back to October. This included a 600 point decrease for Dow on Oct. 24. Typically, October is seen as a volatile month for stocks and this year was no exception to that trend.
November started on an upswing. Not even ten days into the month though, according to Yahoo Finance’s stock chart featuring Dow, the index showed a downward trend till the very end of the month when it hit another brief upswing.
Despite the rough nature of the previous months, December proved to be even more devasting. CNN reported, “In one seven-day stretch, the Dow fell by 350 points or more six times. This year’s Christmas Eve was the worst ever for the index.”
The year of 2018 was not all bad for the stock market due to the strong economic growth at the beginning of the year. Yet, because of these extreme downturns, the end of the year proved to be the worst in a decade. Times like these show how volatile the stock market can be. It’s impossible to predict exactly when the stocks will reach these highs and lows, even for those who dedicate their careers to making educated assumptions on this game of chance.
The year of 2019 is predicted have a limited growth which highly contrasts 2018’s rapid growth, but where this year will most likely redeem itself with is some more stability. Only time will tell though on how the stock market will actually perform.