Both of those factors sent inflation in the U.S. soaring to record levels not seen in over 40 years. As a result, the Federal Reserve (Fed) began raising interest rates in March 2022 to slow the economy down and arrest the pace of price rise.While inflation persisted, Fed's aggressive rate hikes stoked fears of a recession. The Dow started 2022 with a flourish, breaking closing records in the first two trading days of the year. The most recent record closing occurred on Jan. 4, when the index closed at 36,799.65, blowing past the all-time high closing of 36,585.06 it had just a day before. The one before that came on the final trading day of 2021, when Dow closed at 36,488.63 on Dec. 29, 2021, smashing the record it set on Nov. 8, 2021.
The Dow fell 17% in three months, from 2,864.60 on Aug. 2 to 2,365.10 on Oct. 11, 1990. Kimberly Amadeo has 20 years of experience in economic analysis and business strategy. These changes are not done often to ensure the index's stability and continuity. Since the Great Depression, 2007 to 2008 has been the most dramatic period for the DJIA.
This historic peak came after years of growth, economic recovery, and optimism in the market. By understanding the events and factors behind this achievement, we can better appreciate the significance of this record-breaking moment in stock market history. I'm an experienced financial analyst with a specialization in stock market indices, including the Dow Jones Industrial Average (DJIA). My expertise is demonstrated through years of analyzing market trends, economic indicators, and historical data. I have actively tracked and studied the Dow's movements, including its peaks, troughs, and notable milestones.
What’s new this time is Trump’s refusal to rule out a recession near term. The president has been discussing a period of "transition" as these taxes on foreign imports take hold. If tariff turmoil sparks a recession or general downturn in the U.S. economy — still far from a certainty — that would take the discussion to a more alarming level. Equities have gone full-tilt into a risk-on stance, and the Dow Jones is on pace to close up nearly 500 points in record territory. President Donald Trump and his economic team are facing questions about a possible recession —and failing to ease mounting jitters about the economy.
After hitting the Jan. 26 peak, the Dow went into free fall, dropping 4% the next week. On Feb. 8, it entered a market correction when it fell 1,032.89 points to 23,860.46. But this robust start was not indicative of extreme volatility the index would face as the year foreign exchange fraud progressed. First, the conflict between Russia and Ukraine saw gas prices spike sharply. At the same time, the strength in the U.S. labor market meant extremely competitive wages driving consumer demand.
What to Expect from Nvidia's GPU Conference Next Week
Despite Friday's huge rally, each of the major indexes posted losses for the week amid growing political and economic concerns. Younger investors in their 20s and 30s, with more time to recover from losses, can afford to play more aggressively and might even view the current slide as a buying opportunity. But even older people in their 60s and 70s might have 10 or 20 more years to work with. Over time, the stock market invariably pushes higher, and that means the odds of sustaining a loss are greatly diminished. These big players accounted for a growing share of overall returns for the S&P 500, making the index and the many mutual funds tied to it increasingly undiversified.
What Is the Dow Jones Industrial Average (DJIA) All-Time High?
The Dow's activity broke new records in terms of downward movement in 2009. While it wasn't as dramatic as the Great Depression, the drop happened much more quickly. After recovering from its Great Depression level, the Dow continued to be affected by several recessionary periods and crises leading up to the 2009 downturn. On July 3, the Dow hit a new high when the Trump administration announced it would resume trade negotiations with China, averting additional tariffs (taxes on imports). The Dow posted its all-time high during in December 2024, peaking at over 45,000 points.
Three straight weeks of declines have shaved 9.3% from the value of the Standard & Poor’s 500 index, with similar declines for the Dow Jones Industrial Average and other yardsticks. Citing the risk of higher tariffs, Goldman Sachs increased its recession forecast on Friday — but not dramatically. The Wall Street bank now sees a 20% chance of a recession over the next 12 months, up from 15% previously. The economy added jobs in February for the 50th month in a row, the second-longest period of uninterrupted growth in modern history. From its humble beginnings in 1896 with just 12 companies, the Dow Jones Industrial Average has since been a global icon, serving as a benchmark for investors, analysts, and the public alike. Despite its limitations, the DJIA continues to be one of the most closely monitored indices, providing valuable insights into the constantly evolving global market.
- While the Dow is widely followed, some critics argue its limitations.
- In the autumn, it began to consistently close above 35,000 points, and by the last week in Dec. 2021, it surpassed 36,000 points.
- Ulta posted earnings per share (EPS) of $8.46 on net sales of $3.49 billion, ahead of Visible Alpha estimates of $7.13 and $3.46 billion, respectively.
How Worried Should you be About a Recession?
It isone of the oldest stock indexes in existence and offers the longest market return history. On Monday, Sept. 15, 2008, Lehman Brothers Holding, Inc. (an investment bank) declared bankruptcy. On Wednesday, panicky bankers withdrew $144 billion from money market funds, almost causing a collapse. The index closed above 18,000 on Dec. 23, and then closed its high for the year at 18,053.71 on Dec. 26. The chart below shows four of those closing records, as axitrader review they increase by the thousand.
- The electric vehicle maker has also given up all its post-election gains as CEO Elon Musk has become a ubiquitous presence in Trump's White House.
- At the time, the stationary bike maker said it has a "steep hill to climb to reach sustained, profitable growth."
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- In parentheses, when helpful, we provide the Dow's points as inflation-adjusted to Feb. 23, 2024, for a relative comparison to its record highs.
- “I wouldn’t be surprised if the Fed is locked on hold for many, many months,” Dudley said, adding that a rate cut in May would be “way too soon” even though some on Wall Street are predicting that.
Futures Point to Higher Open for Major Stock Indexes
For better balance among your holdings, you might want to add a foreign stock fund, a bond fund or something along the lines of a real estate fund or even one pegged to precious metals. Funds tied to foreign stock markets also should be part of a balanced portfolio. Nowadays, the market has become more evolved as the Dow Jones Industrial Average measures the share prices of 30 blue-chip, publicly traded companies across various sectors, excluding the transportation and utilities sectors.
The most recent all-time-high record (as of this writing) was on Jan. 4, 2022, when it closed at 36,799.65. The Dow climbed above 38,000 in January 2024 and reached 40,000 by May. The index peaked again in July, almost reaching 42,000, then rallied in September when the Fed started cutting interest rates for the first time since 2020. Uncertainty had been hanging over the markets because of the unprecedented refusal of the outgoing president, Donald Trump, to concede the election to President-elect Biden.
The S&P 500 (SPX) entered a correction Thursday amid concerns that Trump administration policies, notably tariffs, could slow economic growth and reignite inflation. The benchmark index, which dropped into correction on Thursday, is down 4.3% so far this week. It is tracking to finish with weekly losses for the fourth straight week. Ulta posted earnings per share (EPS) of $8.46 on net sales of $3.49 billion, ahead of Visible Alpha estimates of $7.13 and $3.46 billion, respectively. Comparable sales growth of 1.5% surpassed expectations of a 0.8% increase. Along with the sale announcement, Crown Castle reported a fourth-quarter loss of $10.97 per share, while analysts surveyed by Visible Alpha Football stocks were looking for a gain.
“We believe the economy will avoid slipping into recession,” Wells Fargo economists wrote in a research note, pointing to “solid fundamentals” such as healthy household balance sheets as a buffer. Nvidia (NVDA) is set to kick off its weeklong GPU Technology Conference in San Jose, California on Monday, with a keynote address from CEO Jensen Huang on Tuesday. The Dow has lost 2.5% since the start of 2025, while the S&P 500 and Nasdaq have declined 4.1% and 8.1%, respectively, over that period. The Dow shed 3.1% this week, its worst weekly performance since March 2023. The Dow has fallen in four of the last six weeks, and has slipped into negative territory for the year.
Record Highs Set in 2022
The introduction of indices into the global markets continues to play a significant role as a simplified benchmark used to gauge the performance of any stock market segment or any economy. One of the earliest and most followed indices is the Dow Jones Industrial Average. In general, the Dow has underperformed during strong years in the stock market because the Dow has a higher focus on value and income, whereas the Nasdaq Composite focuses less on value and income. If the market is doing well, that probably means investors are willing to take on more risk, pay a higher price for growth, and gravitate toward Nasdaq stocks. In summary, the Dow Jones Industrial Average remains a key barometer of the stock market, reflecting the performance of major U.S. companies, albeit with limitations due to its narrow focus on only 30 large-cap stocks. Its historical trends offer valuable insights into market behavior and economic shifts.
The tech companies in the Dow -- Apple, Microsoft, Cisco Systems, International Business Machines, Intel, and Salesforce -- are all proven businesses and leaders in their fields. While the Dow is widely followed, some critics argue its limitations. It comprises only 30 large-cap companies, which may not fully represent the overall U.S. economy. Many prefer the S&P 500, a broader index with 500 companies, as a more comprehensive economic indicator.