The Dow Jones posted it’s worst quarter ever – Now What?

Dow Jones Picture

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Historical performance after quarterly market crashes

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The Dow Jones just had it’s worst quarter on record in what turned out to be the fastest decline to a bear market in history.  That being said the last full week of the month had two of it’s largest single day inclines.  President Trump states that we will be in for a very, very painful next two weeks with the rampant spread of the Coronavirus. DoubleLine Capital CEO Jeffrey Gundlach believes that the market declines could continue in April and we may see a new bottom in the market towards the middle of the month.  Here is a chart of how the three major indexes performed in the first quarter.

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However, if we look back over the history of the stock market this should give investors cause for hope.  By staying invested during the downturns you can expect positive returns over the next two quarters and an over 20% return 1 year from the decline. Investors are hoping the market has bottomed, with many strategists expecting a “V” shaped recovery, a sharp drop in GDP in the second quarter and a swift snapback in the third quarter.  Here is a quick look at how the market has performed after the seven worst quarters in the history of the market.

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For help reviewing your current allocation and performance or areas of the market where you may have good buying opportunities, please reach out.

 

 

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