Prior to the opening bell on Monday, August 24, 2015, market optimists may have hoped that the S&P 500 would be approaching the 2200 mark within a year. Five minutes later, it was the last thought on their minds.
Last year’s “flash crash” saw the S&P 500 plunge an incredible 5 percent within minutes of the opening, falling from a 1965 opening price to as low as 1867. Despite a sharp bounce-back, the market re-gained selling pressure into the close to finish the day down 3.6 percent.
In addition to a number of structural market issues, the flash crash came in response to fears that China’s economy was on the brink of a major downfall that could send shock waves around the world.
The flash crash marked the height of the 2015 China-related market volatility. All-in-all, the S&P 500 plummeted from about the 2100 level to 1867 within a matter of days.
As it turns out, the flash crash marked the beginning of an incredible nine-month period of market volatility.
The S&P 500 briefly spiked back above 2000 in mid-September 2015 before the second leg of its double dip below 1875 later in the month. However, the market then went on a tear and climbed as high as 2116 by the beginning of November.
When China fears resurfaced in late December, the S&P 500 endured its worst January in history. The early 2016 selloff took the S&P 500 below 1825 in both January and February.
By late April, it was back above 2100. Today, it is within a stone’s throw of breaching the 2200 level for the first time in history, and the SPDR S&P 500 ETF Trust SPY 0.23% is up 7.2 year-to-date.
It’s hard…
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