The stock market performance in December has been termed as the worst performance of U.S stocks since the Great Depression in 1930. The dramatic decline in stock exchange has been evidenced by two key stock indexes: Dow Jones Industrial Average and the S&P 500 which closed at 7.6% and 7.8%. The significant decline of the two benchmark U.S. stock indexes has led the Russel 2000 to close in the bear market territory, a phenomenon that has greatly stunned economic analysists as well as worry investors across the country. In early October 2018, the Dow Jones average reached an all-time high of 26, 951.81 but dropped more than 3300 points in less than two months to close at 23, 592.98 on Monday with a high probability of an even worse decline.
In the past, the U.S stocks have always ended the year on a high a situation usually referred to as” Santa rally” but this year looks different attributed to a rapid decline in stock’s price. With close to two weeks remaining to mark the end of December, the situation is most likely to worsen indicated the Russell 2000 which stands at 20.6% from highs. The Russell 2000 is a crucial indicator of the movement of the Dow and S&P 500. A high Russell 2000 value points to a falling Dow and the S&P 500.