Bears trump bulls on inauguration day
People around the world watched Barack Obama’s inauguration on Tuesday with anticipation and hope, but the stock market took a bleaker view, with the major U.S. indices down more than four percent, the biggest-ever inauguration day stock market decline.
The stock market has historically fallen during inaugurations. The chart below, with an average 0.55 percent decline, shows the Dow’s performance during planned inaugurations days since 1897; it does not include unplanned inaugurations after a president’s death. Republican inaugurations are in red, Democrats in blue.
Do you have an explanation for the market’s behavior? Leave your answer in the comments section.
I have an article on my blog about this very subject. I believe the problem is the banking sector. It has gone beyond bad sentiment regarding banking stocks. It is a global lack of confidence in the banking industry in general. Unstable banks equals unstable markets. The bears move in on that. Stop by and read the rest of the article.