February 19, 2009
The NASDAQ and the S&P500 moved further down, as both indices recorded their fourth negative day in a row. The DJIA also declined, but since it moved a bit higher yesterday, by just .04 percent, its count was interrupted, and restarted today at minus one.
Taking todays pattern at face value, that is, four down days for the NASDAQ and the S&P500, and only one down day for the DJIA, then we see only two incidents like this since 1950. One occurred in April 1985 while the other, more recent incident, was last September. The 2008 decline was quite sharp, with each index losing about minus three percent.
On the following days, the DJIA and the S&P500 rose twice but gains were limited to the range of .04 percent to .44 percent.
However, the results are considerably more optimistic when all three indices fall four days in a rowthat is, allowing the DJIA to fall, rather than rise .04 percent, yesterday. Of the 14 such days since January 2000, the NASDAQ rose nine times on the following day while the DJIA and the S&P500 increased eight times and fell only six times.
DJIA -1.19 percent
NASDAQ -1.71 percent
S&P500 -1.20 percent