By Jan. 20, it closed at 15,766.74, as investors panicked over plummeting oil prices, the devaluation of the yuan, and turmoil in China’s stock market. But this robust start was not indicative of extreme volatility the index would face as the year progressed. First, the conflict between Russia and Ukraine saw gas prices spike sharply.
- Since the Great Depression, 2007 to 2008 has been the most dramatic period for the DJIA.
- Any historical returns, expected returns, or probability projections are hypothetical in nature and may not reflect actual future performance.
- Many investors—both institutional and individual—had borrowed or leveraged heavily to buy stocks, and the crash that began on Black Thursday wiped them out financially, leading to widespread bank failures.
- The index peaked again in July, almost reaching 42,000, then rallied in September when the Fed started cutting interest rates for the first time since 2020.
Economic & Market Factors Behind the 2024–2025 Dow Highs
The number of companies included in the index increased to 20 in 1916 and then to the current number, 30, in 1928. Since then, the Dow has remained among the most frequently discussed and commonly tracked equities indexes.
Recession of 1953
“40,000 is a great milestone, but end of the day there isn’t much difference between 39,999 and 40k,” Ryan Detrick, chief market strategist at Carson Group, said in a statement emailed Thursday. These big, round numbers don’t mean much, but they do serve as a reminder that over time stock investments can pay off. The S&P 500 has returned about 10.6% annually for the past 100 years, according to analysis from Trade That Swing. The Dow Jones industrial average finished above 40,000 for the first time on Friday afternoon, doubling where the index hit shortly after Donald Trump became the 45th president. The easiest way to invest in the Dow may be to buy shares in State Street Global Advisors’ SPDR Dow Jones Industrial Average ETF Trust, which trades under the ticker symbol DIA.
Record Highs Set in 2022
For starters, the Dow Jones we know is not a person — but you already knew that. Named for its two founders, the Dow Jones is a stock market index, just like the or the Nasdaq. On that day, it closed at 7,286.27, a 37.8% decline from its peak. No one knew if a new bull market had begun until the Dow hit a higher low on March 11, 2003, closing at Analizes 7,524.06. The records set in the fall were the first ones since the Dow reached 26,616.71 on Jan. 26, 2018. After hitting the Jan. 26 peak, the Dow went into free fall, dropping 4% the next week.
What has been the Dow’s largest, single-day point gain?
Only three days traded more than 200 million shares, a level similar to the late 1990s. The Dow was volatile in 2015 because it was based on just a few companies. Record-low interest rates allowed firms such as Apple and IBM to borrow billions to buy back shares. These actions artificially raised their earnings per share and the prices of their remaining outstanding stocks (stocks which are still held by shareholders). The Dow Jones Industrial Average is one of the many gauges of stock market performance. This history of the Dow since the Great Depression demonstrates how stock market fluctuations reflect the natural stages of the business cycle.
Dow Jones All-Time Highs vs. Other Major Indices (
Shares for most of the firms tracked by Dow rose in value on Friday, led by Intel (4.7%), IBM (2.8%) and Home Depot (2.6%), while shares for Walmart, Boeing and JPMorgan Chase fell slightly. Different indices reflect different trading styles, short-term Nasdaq rallies mirror day trading vs swing trading strategies in practice. From the Great Depression to COVID-19, but it has always bounced back to set new records. The August 2025 record is just the latest proof of that resilience. Even so, the gains posted by Ambrx Biopharma (AMAM) in Friday’s session are unusual and particularly eye-catching. The stock soared to the tune of a hardly believable 1007% after the company announced pleasing results from the mid-stage testing of its breast cancer drug ARX788.
- While it wasn’t as dramatic as the Great Depression, the drop happened much more quickly.
- After recovering from its Great Depression level, the Dow continued to be affected by several recessionary periods and crises leading up to the 2009 downturn.
- The DJIA shows how America’s biggest companies are performing and is a quick way to check the pulse of the economy.
- In the midst of a recession, the Dow has two milestone days of gains.
- The highest Dow Jones Industrial Average close is 45,631.74, set on August 22, 2025.
- It then enters a period of volatility and drops to 8,920.70 after markets open following the September 11, 2001 terrorist attacks.
References to any securities or digital assets are for illustrative purposes only and do not constitute an investment recommendation or offer to provide investment advisory services. The Dow sees the end of a long bull market on Jan. 14, 2000, in part due to the strength of the Internet business and the subsequent bursting of the dot-com bubble. It then falls on March 7, 2000, rebounds to 11,124.83 on April 25, and falls again to 9,973.46 by March 14, 2001, beginning the 2001 recession.
That said, we’ve never seen a fall as dramatic as the stock market crash of 1929, after which the Dow lost nearly 90% of its value over the course of three years. The Dow started 2022 with a flourish, breaking closing records in the first two trading days of the year. The most recent record closing occurred on Jan. 4, when the index closed at 36,799.65, blowing past the all-time high closing of 36,585.06 it had just a day before. The highest Dow Jones Industrial Average close is 45,631.74, set on August 22, 2025. This surpassed the previous record of 45,014.04 from December 2024.
The Dow’s all-time high reflects strong tech earnings, cooling inflation, and expectations of future Fed rate cuts. When the stock market crashed on October 19, 1987 — a date known colloquially as Black Monday — the Dow experienced its largest percentage drop in history, a whopping 22.6% decrease in a single day. The Dow hit record highs in 2024–2025 thanks to a perfect storm of strong earnings, lower inflation, and huge gains from mega-cap tech stocks.
This beat the previous high of 45,014.04 from December 2024. Many investors—both institutional and individual—had borrowed or leveraged heavily to buy stocks, and the crash that began on Black Thursday wiped them out financially, leading to widespread bank failures. That, in turn, became the catalyst that sent the United States into the Great Depression of the 1930s. Many were buying stocks on margin—the practice of buying an asset where the buyer pays only a percentage of the asset’s value and borrows the rest from the bank or a broker.
Margin credit rose from 12% of NYSE market value in 1917 to 20% in 1929. Because of the price-weighted calculation method, a $1 change in the price of a stock in the DJIA doesn’t equate to one point in the index since that depends on the Dow divisor at the time. As such, point moves are a way to measure the relative change in the index’s value. That said, when comparing the value of the DJIA over time, many financial sites, as we have done above, use an inflation-adjustment calculator such as the U.S.
It then enters a period of volatility and drops to 8,920.70 after markets open following the September 11, 2001 terrorist attacks. The recession ends in November 2002 after a period of war-related uncertainty. The largest single-day drop, percentage-wise, that the Dow has had occurred when the market crashed on Oct. 19, 1987, Black Monday. Stock market gains since the 2008 financial crisis were mediocre in volume.
Given its large-cap focus, the roster of companies included in the Dow fails to include companies of other sizes. Many market observers think the S&P 500 is a much better representation of the economy, as it includes 500 companies and draws more widely from different sectors. These changes are not done often to ensure the index’s stability and continuity. Previously, the Dow had fallen from 11,723 in January 2000 to 9,389 in March 2001, dropping 20% (from 20,520 to 16,434 points, inflation-adjusted). The bout of inflation that followed the COVID-19 pandemic led to another sharp sell-off in 2022. Between Jan. 7, 2022, and Sept. 30, 2022, the Dow declined about 21% from 36,231.66 to 28,725.51.
Following the Great Recession, it took about five years for the stock market to recover. The Dow returned to its pre-recession highs in March 2013. Unlike the S&P 500 or Nasdaq (which are weighted by company size), the Dow uses a special math trick called the “index divisor.” This lets it account for stock splits and changes in the Dow 30 lineup. Stocks with higher prices (like UnitedHealth or Goldman Sachs) have more impact on the index than lower-priced stocks, even if they’re smaller companies. The Dow Jones is a price-weighted index—this means the 30 companies with the highest stock prices move the Dow the most, not the biggest by market cap. The Dow Jones always bounces back—even after historic crashes.
What Investors Should Remember:
See the top 10 highest closing values in Dow Jones history, including the record-breaking 45,014.04 set on December 4, 2024. A record high doesn’t mean “buy now” or “panic sell”—it’s just one milestone in the market’s long journey. Since the Great Depression, 2007 to 2008 has been the most dramatic period for the DJIA. The market fell more than 50% in just a year and a half because of subprime mortgage and credit crisis that kicked off the Great Recession.
Then, in the last few months of 2023, investors began piling back in as hopes grew that interest rates would soon be cut and a nasty recession averted. By the end of 2023, the previous high, registered in January 2022, had been surpassed, and the 37,000 mark had been breached. The Dow hit one milestone and had 26 closing records in 2016. Of the 26 records set that year, 17 occurred after the presidential election. The index’s 2016 closing high was 19,974.62, set on Dec. 20, 2016. It hit two of them in the first few weeks in January, closing above 25,000 on Jan. 4.
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