Evaluation of the Dow

The Dow Jones Industrial Average has seen a significant decrease in the value of the stock market. Just this February, the Dow was at an all-time high of 29,551 points and then subsequently dropped to 18,591 at the end of March due to the increased severity of the global coronavirus pandemic. Now in late April, the Dow Jones remains at a low of 23,475. Uncertainty and public fear surrounding COVID-19 is a huge factor behind the current state of the Dow market. The economy has fallen to unprecedented levels as people are being forced to stay home and all non-essential businesses are being closed for the time being. Americans are spending less because they are confined to their houses and many of them have lost their income.
The US government is responding by bailing out bankrupt corporations and releasing stimulus packages to citizens in hopes of restoring confidence in the stock market. The Dow will not be able to rise again until the coronavirus is controlled, ideally with the development of a vaccine. In the upcoming months, I think there will be a gradual increase in the Dow, however, this will not be sustainable without a vaccine in sight and the arrival of a potential second wave of the coronavirus. Businesses are becoming impatient as lockdown is extended and some are reopening earlier than safe. In addition, COVID-19 testing is still not as accessible as it should be meaning that the number of cases is uncertain and a confident judgment about the duration of the crisis cannot be made. Hopefully, in the near future, the emergence of a vaccine and the lifting of lockdowns will prompt the Dow’s recovery.
The coronavirus and its effect on the Dow will certainly affect the power of the US federal government. The fluctuations in the stock market are to some degree a reflection of the president’s actions. It is arguable that President Trump’s failure to duly acknowledge the severity of the virus has led to the extremely high and growing number of cases in the US. In upcoming presidential elections, people will be looking for someone who will appropriately manage the results of the virus to be in power. President Trump is desperately trying to keep the stock market up so he can be reelected.

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