WhyItDropped

S&P 500 · April 9, 2009

A bank said it had made money

+3.81%

single-day change vs previous close

Part of a longer stretch

Eighty percent in a year off the bottom

early in it · 2009-03-09 → 2010-04-23, +79.93% over the whole period

What happened that day?

  • On 9 April 2009 the S&P 500 rose 3.81%
  • A large US bank pre-announced that it had made a profit in the first quarter
  • It was the first profit from a sector that had reported nothing but losses for over half a year
  • With rates near zero, banks could borrow cheaply and lend dearly — the structure was in place
  • The banks had caused the crisis, so banks making money read as the turn
  • In this stretch the index was 27.62% below its peak
  • The stress test results a month later confirmed the direction

Sources

Every figure on this page is recomputed from the original daily closing prices and checked against them at build time. The account of what happened is written from the sources listed above.