MARK-TO-MARKET: Volatility returns to US stock market

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As we’ve seen this year, the stock market can be a volatile beast.

Throughout January and February, the stock market continued its gradual ascension, breaking one new all-time high after the next. But then the global COVID-19 pandemic hit. From Feb. 24 to March 23, in less than one month, the major stock indexes hit a punishing decline. The S&P 500 fell 33%, the tech-heavy NASDAQ 28.4% and the Dow Jones Industrial Average (DJIA) 35.9%.

Since the low point of the pandemic-induced sell-off on March 23, the stock market has been on a five-month surge. From March 23-Sep. 2, the S&P 500 gained 60%, the DJIA 56.5% and the NASDAQ a massive 75.7%. Both the S&P 500 and NASDAQ reached new all-time highs while the DJIA fell just 1.6% shy of its record high set back on Feb. 12.

There are a number of factors that have contributed to this historic rally. Back in late March and early April, Wall Street realized the U.S. economy wouldn’t get that worst-case scenario that many initially feared. Yes, the economic fallout would be drastic. But at least the American economy wouldn’t be shut down for 9-12 months, or even longer.

Second, we saw the transitory shift that

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