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Here’s what history says To be sure, those statistics may offer no solace (and no guarantee of future gains) to investors fretting that the wheels may be coming off the equity train that has been powered by promises of fiscal stimulus from President Donald Trump. Anticipated delays in his health-care overhaul has led some to fret that the slog toward implementing pro-business policies, including deregulation, tax cuts and infrastructure spending could be longer than initially expected.
What happens after the stock market suffers a sharp drop for the first time following a protracted period of quietude? That is precisely the question Wall Street investors may be pondering after Tuesday’s downdraft—the biggest daily decline for the U.S. stock-index benchmarks since Oct. 11—resulted in the end of a 109-day streak of days without decline of at least 1%.
But it isn’t exactly clear, beyond lingering concerns about lofty stock valuations, what set off a sharp tumble in stocks on Tuesday, which saw the Dow (DJIA) fall 237 points, or 1.1%, to end at 20,668, the S&P 500 sink 1.2% to close at 2,344, and the Nasdaq Composite Index (COMP) to suffer a 1.8% drop to finish at 5,793. Broadly, it was the worst daily drop for the benchmarks in five months. To many, the market selloff was overdue. But it is hardly anything to write about because as Salil Mehta, a graduate school finance professor, who has worked at Georgetown University and New York University, has noted, stock markets normally decline by least 1% once every 6 sessions.
The four-month period without a drop for the Dow and S&P 500 was uncanny and historic, but may provide some brave souls with buying opportunities, while others wait for the next shoe to drop. Also read: Here’s the latest sign that the ‘Trump trade’ is losing traction What
So did ya'll notice....... 2 months of the rise were even before Trump was President!
The market goes up and the market goes down, or more precisely, when it's up profits are taken. Wall Street is fickle, fluctuations are normal, and anyone with any market experience will tell you the same thing.
If you're in it for the long haul, don't worry about it. If you are in mutual funds even if prices dip you will still make money in dividends. You have to look at long-term performance of a stock or fund. If you are timing the market for profits, you may as well go to Vegas where your odds might be better.
Even if something catastrophic were to happen like in 2008 (which is not likely) the market will still recover. It always has.
All of tRUMP's lies and tweets have been well-tolerated by Americans with 401Ks or other investments in the stock market. But, if the market tanks, they won't be so tolerant of him. It's human nature.
The stock run up never had any fundamentals behind it and could not last. It will fall back to where it was around the end of the year. It'll come back more slowly from there as long and Trump and Co. don't do anything stupid like impose a border tax or start a trade war.
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