New York The first quarter on Wall Street was so extreme it included a bear market and a bull market all its own — moves that sometimes take years or more. Now investors head for spring still unsure which side is in control.
From the second week of the year to early March, the Dow Jones industrial average lost more than a quarter of its value, plunging from just above 9,000 to below 6,550. Retirement accounts were suddenly worth half what they were in 2007.
Then came a rally that left investors’ heads spinning. Over just 13 trading days, the Dow soared 21 percent, bouncing back almost to 8,000.
When the dust settled, the stock market was left with its sixth straight quarter of declines, the first time that’s happened since 1969 and 1970. For the Dow, it was the worst start to the year since 1939.
So what now? The answer could be found in a mixture of economic reports that will help Wall Street determine whether there really is hope that the recession, among the longest since the Great Depression, is turning around — or at least stabilizing.
Manufacturing reports coming this week will give investors clues about whether business is picking up, and the March employment report will shed light on whether the job market pain is still getting worse.
“There was no light at the end of the tunnel in January and February. Now there’s some,” said Hugh Johnson, chief investment officer at Johnson Illington Advisors in Albany, N.Y. “It’s very, very faint.”
On Tuesday, the Dow finished at 7,608.92, a gain of more than 1 percent for the day, still looking a lot better than the lows of early March.