Stock markets made a historical soar - March 26, 2017

Stock markets made a historical soar

American stock markets had a great time in the last months: S&P 500 and Dow Jones didn’t have a day with a bigger fall than 1% for 109 days. This is such a rare phenomenon that it hasn’t happened in decades.

The historical period started after 11th October 2016 and went on until 21st March. In this period S&P 500 slowly hiked more than 9% without a single day having a bigger plunge than 1%. For the S&P that hasn’t happened since 1995. On 21st March the streak ended, but prices started to go up since then again.

Rise of S&P 500 since October 2016

The same is true for Dow Jones, which - just like S&P 500 - had its 1% fall on 11th October 2016. Until 21st MarchSince that day, Dow’s industrial average wasis on the rise too. It’s wason a streak that was last seen in 1963.

The same is true for Dow Jones, which - just like S&P 500 - had its 1% fall on 11th October 2016. Until 21st March Dow’s industrial average was on the rise too. It’s was a streak that was last seen in 1963.

Rise of Dow Jones since October 2016

It’s interesting to see that both indices had a same mild plunge before the presidential election, but soon they recovered and started to hike more. Those plunges were also smaller than 1% every day. It’s also important to see that both indices had their above 1% fall on the same day.

Prices didn’t go down after FED’s rate hike on 15th March but only days later. Some believed this to be a turning point, and some analyst believe that higher rates would be bad for the markets, but most investors expected a raise anyway, and stocks only went even higher after the confirmation came.

We also wrote several times that a higher rate would be better for the economy for various reasons and according to stock prices, our predictions stand. A small market correction, that some believed was necessary, but upward trend remains.

Disclaimer: This analysis is for general information and is not a recommendation to sell or buy any instrument. Since every investment holds some risk, our main business policy is based on diversification to minimize threats and maximize profits. Innovative Securities’ Profit Max has a diversified portfolio, which contains liquid instruments. This way, our clients can maintain liquidity, while achieving high returns on their investments.