U.S. equity markets have taken investors on a wild roller-coaster ride over the last several days. Equities started free-falling after U.S. wage data released on Friday, Feb. 2, showed positive results. While economic news continues to be good, it raises the specter that the Fed will raise interest rates to ward off inflation.
Higher interest rates would result in higher borrowing costs for companies and businesses. Not only that, it would become more expensive for consumers to buy cars and homes.
It turned out that Friday’s drop was just the tipping point. The stock market went on a wild ride again on Monday, with the Dow Jones Industrial Average closing down 1,175 points. This represented the worst point drop in history. And at one point Monday afternoon, the Dow was down 1,579 points, which was the largest intraday point drop in the history of the index.
If all this market anxiety had you reaching for the Dramamine, you aren’t alone. Most people are invested in the market in one way or another. So, many households felt the sting, and it has only slightly abated as the market has begun to recover some of its losses.
