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Quote of the Day
“The more I read…the more confused I get. Everyone has an opinion, and everyone sounds like an authority, and nobody gets it right. It’s kind of a lonely feeling.”
-Investor Dales Foster, as quoted by the New York Times on this day in 1987.
October 20th – This Day in Stock Market History – The Day After Black Monday
October 20th, 1987 – One day after the record 22.6% drop on “Black Monday”, stocks begin to rebound. The Dow Jones Industrial Average finishes the day up 102.27 points, or 5.88%, a record one day point gain.
But the trading day was not in recovery mode all day and the rebound was mainly limited to blue-chip, large cap names. Upon opening at 1,738 the Dow quickly rose 210 points by 10:30am but gave up all of its gains by noon, and by 12:30 was down more than 30 points. The Dow Jones Industrial Average would have another wild day, trading in a range from a high of 2067 to a low of 1616!
As the decline escalated shortly after 12:30, trading in some of the largest companies such as IBM and Eastman Kodak was halted until markets calmed. The chairman of the NYSE was considering closing the exchange for the day until markets caught a bid in the afternoon and began rising once again.
Although the Dow put in the bottom for a recovery, it would be longer before the shares of smaller companies would recover. The Nasdaq index continued in decline and closed the day down 32.46 points (down 9%) and the American Stock Exchange index followed, closing down 24.34 points (down 8.6%). Of all the stocks traded on the New York Stock Exchange; 1,445 declined, 122 remained unchanged and 509 rose.
Best October 20th in Dow Jones Industrial Average History
1937 – Up 6.08%, 7.71 points.
Worst October 20th in Dow Jones Industrial Average History
1906 – Down 2.12%, 1.47 points.
Watch of the Day
If you want to learn a little bit more about the crash of 1987, I thought this was a great documentary called ‘Cancel Crash” that looks into some of the causes of the crash and its effects on the market:
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