WhyItDropped

Nasdaq · January 4, 2005

The first pullback of the year

-2.06%

single-day change vs previous close

Part of a longer stretch

Four months pressed by rates and oil

early in it · 2004-12-30 → 2005-04-28, -12.59% over the whole period

What happened that day?

  • The Nasdaq fell 2.06% on the day, the second session of 2005
  • The index had risen hard over the previous four months. Buying that had crowded into year end simply stopped once the year turned
  • There is a pattern of selling in the new year what was held back through December for tax reasons. It shows up most Januaries
  • The Fed was still raising at every meeting. It was a phase where whatever had run ahead was pressed first
  • The pullback ran four months and bottomed at the end of April

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.