March 2, 2009
We can put a positive aspect on a sad day by considering the accumulated loss rates of the past ten days. Ranked in the order of the severity of their decline, these were the 20th worse for the S&P500, the 26th worse for the DJIA, and for the NASDAQ, only the 77th from the top.
Indeed, the top places in this ranking belong to the bottom of the 1987 bear market, when seven of the top ten deepest losses occurred. In that cycle, these closes coincided with the end of that price correction, and then the market went on to continue its upward trend.
As of yesterday, the S&P500 had lost -15.24 percent from its February 26 position, ten days ago. The DJIA and the NASDAQ were down a little more than -13 percent. Whereas at the bottom of the 1987 drop, the ten-day declines ran in the -20 to -30 percent range.
Is this similarity in the nature of an insight into the developments of the next few days, or just a comparison of seemingly similar phases of the market? As we all know, only time will tell.
DJIA -4.24 percent
NASDAQ -3.99 percent
S&P500 -4.66 percent