A Bumpy Ride

A few days ago we talked about the folly of getting overexcited about a single day's gains in the stock market. We saw the flipside of that yesterday, over a period of less than a day, when the Dow Jones average dropped nearly 1000 points in the middle of the day, causing various Internet sites and news organs to go into conniptions. Granted, when the Dow is dropping through the floor, it's hard to look away, but in the end, the markets rebounded and the Dow finished with a disappointing but hardly historical loss of 3.2 percent.

The roller coaster ride was really just a small part of the day. After opening at 10,842, the Dow drifted slowly along much of the day: It was at 10,798 at 1:00, and at 10,712 by 2:00. By 2:30, the downward trend was apparent, with the index at 10,596, for a loss of 1.9 percent on the day.

Then the plunge hit: Just sixteen minutes later, it was down to 9,873. That's a loss of nearly 7 percent of the Dow's value in a quarter of an hour. But the rebound was even more breathtaking - a gain of 602 points in just ten minutes! That's a gain of more than 6 percent of the Dow's value.

In the end, it lost 348 points on the day. It wasn't even the biggest loss of this past week. Just another ho-hum day on Wall Street.