Yes, the market looked better at the end of the day — but our necks are killing us!
The Dow Jones industrial average plunged as much as 611 points Thursday before rallying in the final hour to close 260.37 points higher at 23,138.82 — a whiplash-inducing roller-coaster ride that came a day after the blue-chip index’s historic, one-day surge of more than 1,000 points.
The S&P 500 and Nasdaq likewise eked out gains Thursday, closing up 0.9 percent and 0.4 percent, respectively, after getting clobbered early on.
Wall Street watchers were hard-pressed to explain what accounted for the market’s rapid rebound when there was little news. Amazon, which had been down 5 percent in midday trades, pared losses to end the day down a more palatable 0.6 percent.
“Nothing changed about Amazon in the last four hours,” noted Michael Antonelli, managing director at RW Baird.
“Fear and greed are splashed all over this tape,” Antonelli added, referring to the wild ups and downs of Thursday’s session.
The same could be said for this week. Wednesday’s record-setting, 1,086.25-point rally came on heels of major indices suffering their worst-ever Christmas Eve performance.
The Dow had tanked 653 points Monday after Treasury Secretary Steven Mnuchin posted a puzzling tweet late Sunday that sought to quell fears about bank liquidity, but instead raised questions about his judgment.
“We are reluctant to take too much from the post-Christmas surge or the break on Dec. 24,” Bruce Bittles, chief investment strategist at RW Baird, said in a Thursday note.
The week between Christmas and the New Year is typically known for lower trading volumes and lack of market-moving news.
But with markets roiled over the last three months on worries of trade tensions between the US and China, fears of a global economic slowdown, and the Federal Reserve’s rate-hiking path, many market participants have given up on trying to fight the tape in the last few days of the year.
“There’s a whole slew of [institutional investors] who are just done for the year, which increases volatility,” Antonelli said.
Traders also got jolted after consumer confidence figures came in lower than expected Thursday due to worries of a slowing economy.
The Conference Board reported that consumer confidence stood at 128.1 in December — down from November’s read of 136.4 and below expectations of 133.5.
“Expectations regarding job prospects and business conditions weakened, but still suggest that the economy will continue expanding at a solid pace in the short-term,” said Lynn Franco, senior director of economic indicators at the Conference Board.
Late Wednesday, the Wall Street Journal reported that the Commerce Department wouldn’t be releasing its usual economic data during the government shutdown, which entered its sixth day Thursday.
Oil, which soared a stunning 8.7 percent in Wednesday’s session, ended down 1.8 percent Thursday after initially sinking deeper and taking energy stocks such as Exxon Mobil and Chevron down with it. The price of oil has fallen roughly 25 percent over the last year on fears of a global slowdown.
