One Year Ago Today the S&P 500 Fell 12 Percent
This was the day the world realized COVID was going to shutter the global economy and that this virus would be a huge problem. Looking back on the day, it started with the S&P 500 falling almost 7 percent following the opening bell triggering a market circuit breaker that halted trading for 15 minutes. This was the third time a circuit breaker had been triggered that week, with the same occurrences on March 9 and 12.
Other major indexes also fell.
- The Dow Jones Industrial Average fell 12.9 percent, its second-largest percentage loss in the post-WWII era, following the infamous Black Monday 22.6 percent decline.
- The Nasdaq fell 12 percent, marking its largest percentage drop in history.
It would be another week before the S&P 500 would bottom on March 23. From Feb 19, 2020 highs to the March 23, 2020 bottom, the S&P 500 fell 34 percent.
It did not take long for markets to recover. By August, the S&P 500 was near its February high. Currently, on March 16, 2021, the S&P 500 is up 77 percent from its bottom on March 23, 2020.
Two pieces of Warren Buffett's famous advice come to mind.
- Buy the dip
- Don't bet against the US