Crisis events and the Dow

Our country has faced numerous challenges and crises over the years. When events occur, your initial reaction may be to make changes to your portfolio. However, we believe it’s a mistake to change your investment strategy in reaction to crises. This table emphasizes the importance of maintaining a long-term perspective during times of crisis.

Crisis events and the Dow
EventReaction datesDow % change in days following the crisis*
 Start dateEnd dateInitial reaction22 days63 days126 days253 days
Germany invades France05/09/194006/22/1940-17.1-
Pearl Harbor12/06/194112/10/1941-6.53.8-2.9-9.65.4
Korean War06/23/195007/13/1950-
Eisenhower heart attack09/23/195509/26/1955-
Cuban missile crisis10/19/196210/27/19621.
JFK assassinated11/21/196311/22/1963-
U.S. bombs Cambodia04/29/197005/14/1970-
Kent State shootings05/01/197005/26/1970-14.09.920.320.743.7
Arab oil embargo10/16/197312/05/1973-18.59.310.27.2-25.5
Nixon resigns08/07/197408/29/1974-17.6-7.9-5.712.527.2
U.S.S.R. invades Afghanistan12/24/197901/03/1980-2.26.7-4.06.821.0
Falkland Islands War04/01/198205/07/19824.3-8.5-9.820.841.8
U.S. invades Grenada10/24/198311/07/1983-2.73.9-2.8-3.22.4
U.S. bombs Libya04/14/198604/21/19862.8-4.3-4.1-1.025.9
Financial panic ’8710/02/198710/19/1987-34.211.511.415.024.2
Invasion of Panama12/15/198912/20/1989-1.9-
Gulf War01/16/199101/17/19914.611.814.315.024.5
Gorbachev coup08/16/199108/19/1991-
World Trade Center bombing02/25/199302/27/1993-
Kobe earthquake (Japan)01/13/199501/16/19950.
Asian stock market crisis10/07/199710/27/1997-12.48.810.525.016.9
Sept. 11 terror attacks09/10/200109/21/2001-14.313.421.224.8-6.7
Iraq War03/19/200305/01/20032.
Indonesia/ Indian Ocean tsunami12/23/200412/27/2004-0.5-2.6-2.7-4.41.0
Hurricane Katrina08/26/200508/29/20050.
India, Israel and Lebanon bombings07/11/200607/18/2006-
Bear Stearns collapse03/14/200803/14/20080.05.63.0-4.4-38.1
Lehman Brothers collapse09/16/200809/16/20080.0-18.8-22.6-32.3-11.5
Japanese earthquake (tsunami & nuclear fallout)03/11/201103/13/20110.52.80.7-6.27.6
Boston Marathon bombing04/12/201304/15/2013-
Chinese market turmoil08/21/201508/25/2015-
U.K. votes to leave European Union06/23/201606/27/2016-
Recession fears on oil price shock10/10/201810/10/2018-3.1-1.0-11.3-0.8-1.0
First confirmed Coronavirus case2/20/20203/23/2020-36.3728.831.643.060.4
Sources: Ned Davis Research/Edward Jones. Copyright © 2019 Ned Davis Research, Inc. All rights reserved. Further distribution prohibited without prior permission.

The 22-, 63-, 126- and 253-day rates of change are calculated from the second date in the Reaction dates column. The first date in the Reaction dates column indicates the start of the market reaction or the trading day prior to the event. 1914 data: In 1916, a new list of 20 stocks for the DJIA was adopted and computed back to the reopening of the exchange on 12/12/1914. NDR analysis for this study adjusted the DJIA index level prior to 12/12/1914 to reflect accurate and consistent data.

Past performance is not a guarantee of future results. The Dow Jones Industrial Average is unmanaged and is not meant to depict an actual investment.