Point losses don't make sense because it's percentages that matter. The other metrics you mentioned do suggest this is of course a noteworthy market crash, but whether that becomes a recession or is anything to seriously worry about long run is a different question.
"The S&P 500 fell by 7.7%, blowing through the first circuit-breaker level that it tripped minutes after trading opened for the day. The S&P 500 is on pace for its worst day since December 1, 2008, when stocks fell by just over 9%.
It is superficially "asinine" because it is so narrow. However, the DJIA, S&P, Russell, etc all track/correlate each other.
> Look at any other index instead.
Or better yet, inlay the graphs of DJIA, S&P, Russell, Nasdaq, etc on the same chart for comparison. You'll see that the graphs all look similar. Meaning they all go up and down at around the same times.
It would seem that the broader indexes would better reflect the market as a whole. But in the real world, DJIA does good enough a job as the S&P, Russel, etc for a bird's eye view of the market.
Indeed. S&P 500 is still not even below of what it was in the end of 2018 after the last major instability. Partly thanks to this, 2019 was a marvelous year with stocks gaining almost 40% during a single calendar year.
My reading is we're in a normal correction that has been exacerbated by COVID and last night's massive fall (-30%) in oil price.
Hah not a crash? Well it kinda is, and if it keeps going further down it will definitely cause a recession. The oil price drop was a huge punch in the gut, and I wonder what happens to US oil production if it stays this low for longer. Or well any oil production that can't compete with these prices.
Almost nobody is drilling new oil wells, they stopped last year sometime. Almost nobody because there are still investors keeping one skeleton crew running just so they have expertise for when the oil price recovers.
Once a well is drilled the cost to drill the well is a sunk cost. You keep pumping oil if the cost to run the pumps is less than the price you get. Most people with oil are large enough to shut down some wells to keep the price up a bit - they harm their own profit in the short term though and still need to sell enough oil to break even.
Nobody being willing to make large cuts is different from nobody making cuts. The US is not a member of OPEC, nor are several other oil producing countries: they don't follow OPEC but may still reduce output.
There is rumor OPEC isn't cutting production because they believe they can undercut their competitors and put them out of business - I don't think that is their motivation, but it is something that can't be ignored.
The 19th largest daily percentage loss in the Dow is -7.32%. Today we briefly hit -7.9%.
The 19th largest daily percentage loss in the S&P 500 is -7.18. Today we briefly hit -7.2%.
If you don't classify that as a "crash," then please state your criteria for us to examine. It may not be a major crash, but it's definitely notable.
https://en.wikipedia.org/wiki/List_of_largest_daily_changes_...
https://en.wikipedia.org/wiki/List_of_largest_daily_changes_...