WhyItDropped

S&P 500 · July 12, 1974

Summer of the year inflation met recession

+4.08%

single-day change vs previous close

Part of a longer stretch

The 1973–74 oil shock bear market

near the end of it · 1973-01-11 → 1974-10-03, -48.20% over the whole period

What happened that day?

  • The S&P 500 rose 4.08% to close at 83.15. No single trigger for the day could be pinned down
  • 1974 produced an unusual combination: prices rising fast while the economy weakened
  • Normally a weak economy holds prices down. When both go wrong at once, rates can be neither raised nor cut
  • So the fall that year was long and deep — 37.5% from the March high to the October low
  • Even in such a stretch, big up-days appear. Prices come a long way down and briefly retrace
  • The bottom was nearly three months away, on 3 October

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 put together from the public record; where a specific source was consulted it is listed above.