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Monday, October 13, 2008

It was conceivable and expected:

In the news: (emp add)
Dow jumps 938 as governments pledge bank aid

NEW YORK - Wall Street has stormed back from last week's devastating losses, sending the Dow Jones industrials soaring a nearly inconceivable 938 points after major governments' plans to support the global banking system reassured distraught investors.

The Dow by far outstripped its previous record for a one-day point gain, 499, reached during the waning days of the dot-com boom in 2000.

The market was likely to have a rebound after eight days of precipitous losses that took the Dow down nearly 2,400 points, but no one expected this kind of advance.
Bear market rallies are notorious for being extremely strong and sharp. Considering the huge losses over the past twelve months, an 11% jump - especially after a world-wide rescue plan is announced - is not surprising.



2 comments

Dead cat bounce?

By Anonymous e. nonee moose, at 10/13/2008 3:58 PM  

Barry at The Big Picture had a couple of posts about how huge rallies (300 pts) ONLY happen in bear markets.
http://bigpicture.typepad.com/comments/2008/08/300-point-rally.html

So yes, should have been expected.

By Blogger PseudoNoise, at 10/13/2008 4:18 PM  

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