Worst May Ever For The Dow? Not Quite
The Dow Jones Industrials took it on the chin for most of May, finishing with the worst performance in 70 years. Even though it came up from its fall under 10,000, closing at 10,136.63 on Friday, the final figure was a 7.9% loss for the month. It’s the percentage that makes May 1940 worse, as back then shares dropped 22%, making it the worst May in history.
Last week I talked a little bit about how the global economy takes its toll on the Dow, and last week’s overall performance illustrates that point again. There are great worries about Spain’s credit downgrade and an announcement from France that they might be in trouble soon as well. There’s also uneasiness after tensions started to grow once more between North and South Korea, as they’ve suspended some of the considerations they’ve had between each other for nearly 40 years, although in my mind I don’t see war breaking out any time soon, if ever. However, it does mean that the United States will start taking a more active role again, and any time that happens the Dow gets nervous.
All of this is happening during the same time period when the housing market overall is starting to show signs of recovery and consumer confidence is on the rise. It will be interesting to see what the unemployment numbers are next month as we move into summer, and of course the first month of housing purchases since the federal tax credit ended in April. People also still aren’t spending as much as the government would hope, but it’s face it, until more people are back to work, that’s the way it’s going to be.
Be thankful for the extra day of time off to let minds rejuvenate, and please take time to think of those who have given their lives so that this country can be what it is.