If there is one thing to take away from the financial markets, it’s that they are emotional wrecks. Futures markets tanked on the news that Trump was going to win the presidency in the United States. They don’t like uncertainty, and who is a more uncertain force than Donald Trump? Turns out, they’re fine now.
U.S. stocks were holding up remarkably well and jumped Wednesday as the major indexes pared steep losses after markets careened out of control in volatile trading overnight after a speech by U.S. President Elect Donald Trump helped reassure investors after his upset win vs. Hillary Clintoncaught investors around the globe by surprise.
The Dow Jones industrial was up almost 200 points, or 1%, after tumbling as much as 800 points in late-night futures trading.
The broad Standard & Poor’s 500 stock index, which was down 5% overnight and hit a trading halt designed to limit losses, erased its steep declines and was up 0.9%. The Nasdaq composite gained 0.8%.
The article listed above goes on to provide explanations as to why the dramatic bounce back happened, but I can simplify this for you: We don’t know. We’ll never know. It’s a fool’s game to try.
Don’t listen to the financial experts. They are almost always wrong.
Here’s what happened. The unexpected happened. The unexpected leads to uncertainty. The markets hate uncertainty, and so people (who make up the markets) panic. Then, they look up and see the sky isn’t falling. So they are like “Oh. Okay.” And it’s all sunshine again until the next unexpected thing happens again.
Stop thinking this stuff is the end of the world, people. Calm down.