The Dow Jones Industrial Average is approaching a feat it hasn't accomplished since 1978.
The Dow Jones Industrial Average has experienced a slide for eight consecutive days heading into Tuesday, with forecasts indicating additional declines for the 30-stocked index at the bell on Tuesday.
Since February 1978, blue-chip stocks haven't closed with consecutive red figures for a nine-day stretch, as per FactSet's data.
The recent market downturn has been relatively tame, with the Dow experiencing a decrease of only 3% over the past eight trading days. This is a minor hiccup in the grand scheme of things.
Moreover, the losses have largely been confined to the Dow.
The Nasdaq, fueled by tech giants and the AI boom, is still thriving. It climbed an additional 1.2% on Monday, reaching new highs. The S&P 500 also saw gains on Monday.
"It's a bit peculiar," remarked Keith Lerner, co-chief investment officer and chief market strategist at Truist Advisory Services. "There's a steady flow of funds into technology stocks. This is the main trend driving this market - AI and technology."
UnitedHealthcare Group has been a major contributor to the recent losses on the Dow. The insurance giant has witnessed a 18% decrease in value this month, with the slide commencing shortly after the lethal shooting of UnitedHealthcare CEO Brian Thompson. UnitedHealthcare recorded further losses on Monday following Trump's promise to dismantle drug-industry intermediaries.
The Dow's current eight-day losing streak is its longest since 2018, and it precedes the Federal Reserve's interest rate decision on Wednesday.
Investors generally anticipate a quarter-point rate cut from the Fed, although officials may hint at a reduction in the rate of cuts in 2025.
Despite the recent slump, the blue-chip index is up by 16% thus far in 2021. Moreover, the Dow is still around 1,500 points (3.5%) above its pre-election day level.
Markets saw a surge following the election results, with investors expressing relief over avoided recounts and legal challenges. There's also been substantial excitement surrounding Trump's pledges to scrap red tape and taxes.
"After the election, investors focused solely on the positive aspects of Trump's policies. Next year, they'll need to consider both the positives and the negatives," said Lerner, alluding to concerns about Trump's proposals to boost tariff rates and initiate mass deportations.
No streak of losses exceeding ten days has been observed since the 11-day decrease in 1974, according to FactSet's data.
The recent downturn in the market has negatively impacted some businesses, as evident by UnitedHealthcare Group's 18% decrease in value this month. Despite the recent eight-day slide in the Dow Jones Industrial Average, many businesses, such as tech companies, are still experiencing growth.
