Precursor In 1884,
Charles Dow composed his first stock average, which contained nine railroads and two industrial companies that appeared in the ''Customer's Afternoon Letter
, a daily two-page financial news bulletin which was the precursor to The Wall Street Journal. On January 2, 1886, the number of stocks represented in what is now the Dow Jones Transportation Average'' dropped from 14 to 12, as the
Central Pacific Railroad and
Central Railroad of New Jersey were removed. Though comprising the same number of stocks, this index contained only one of the original twelve industrials that would eventually form Dow's most famous index.
Initial components Dow calculated his first average purely of industrial stocks on May 26, 1896, creating what is now known as the
Dow Jones Industrial Average. None of the original 12 industrials still remain part of the index. •
American Cotton Oil Company, a predecessor company to
Hellmann's and Best Foods, now part of
Unilever. •
General Electric, still in operation, removed from the Dow Jones Industrial Average in 2018. Following World War I, the United States experienced another economic downturn, the
Post–World War I recession. The Dow's performance remained unchanged from the closing value of the previous decade, adding only 8.26%, from 99.05 at the beginning of 1910, to a level of 107.23 at the end of 1919. The Dow experienced a long bull run from 1920 to late 1929 when it rose from 73 to 381 points. In 1928, the components of the Dow were increased to 30 stocks near the economic height of that decade, which was nicknamed the
Roaring Twenties. This period downplayed the influence of the
Depression of 1920–1921 and certain international conflicts such as the
Polish–Soviet War, the
Irish Civil War, the
Turkish War of Independence and the initial phase of the
Chinese Civil War. After a peak of 381.17 on September 3, 1929, the bottom of the 1929 crash came just 2 months later on November 13, 1929, at 195.35 intraday, closing slightly higher at 198.69. The
Wall Street Crash of 1929 and the ensuing
Great Depression over the next several years saw the Dow continue to fall until July 8, 1932, when it closed at 41.22, roughly two-thirds of its mid-1880s starting point and almost 90% below its peak. Overall for the 1920s decade, the Dow still ended with a healthy 131.7% gain, from 107.23 to 248.48 at the end of 1929.
1940s Post-war reconstruction during the 1940s, along with renewed optimism of peace and prosperity, brought about a 33% surge in the Dow from 150.24 to 200.13. The strength in the Dow occurred despite the
Recession of 1949 and various global conflicts.
1950s During the 1950s, the
Korean War and the
Cold War did not stop the Dow's climb higher. A nearly 240% increase in the average from 200.13 to 679.36 ensued over the course of that decade.
1960s The Dow began to stall during the 1960s as the markets trudged through the
Kennedy Slide of 1962, but still managed an 18% gain from 679.36 to 800.36.
1970s The 1970s marked a time of economic uncertainty and troubled relations between the U.S. and certain Middle-Eastern countries. The
1970s energy crisis was a prelude to a disastrous economic climate along with
stagflation, the combination of high unemployment and high inflation. However, on November 14, 1972, the average closed at 1,003.16, above the 1,000 mark for the first time, during a brief relief rally in the midst of a lengthy bear market. The nadir came after prices dropped more than 45% over two years since the NYSE's high point of 1,003.16 on November 4, 1972. In 1976, the index reached 1,000 several times and it closed the year at 1,004.75. Although the
Vietnam War ended in 1975, new tensions arose towards
Iran surrounding the
Iranian Revolution in 1979. Performance-wise for the 1970s, the index remained virtually flat, rising 4.8% from 800.36 to 838.74.
1980s from about the 2,500 level to around 1,750. Two days later, it rose 10.15% above the 2,000 level for a mild recovery attempt. The 1980s began with the
early 1980s recession. In early 1981, the index broke above 1,000 several times, but then retreated. After closing above 2,000 in January 1987, During the 1980s, the Dow increased 228% from 838.74 to 2,753.20; despite the market crashes,
Silver Thursday, an
early 1980s recession, the
1980s oil glut, the
Japanese asset price bubble, and other political distractions. The index had only two negative years in the 1980s: in 1981 and 1984.
1990s The 1990s brought on rapid advances in technology along with the introduction of the
dot-com era. The markets contended with the
1990 oil price shock compounded with the effects of the
early 1990s recession and a brief European situation surrounding
Black Wednesday. Certain influential foreign conflicts such as the
1991 Soviet coup d'état attempt which took place as part of the initial stages of the
Dissolution of the Soviet Union and the
Revolutions of 1989; the
First Chechen War and the
Second Chechen War, the
Gulf War, and the
Yugoslav Wars failed to dampen economic enthusiasm surrounding the ongoing
Information Age and the "
irrational exuberance" (a phrase coined by
Alan Greenspan) of the
dot-com bubble. Between late 1992 and early 1993, the Dow staggered through the 3,000 level making only modest gains as the
biotechnology sector suffered through the downfall of the Biotech Bubble; as many biotech companies saw their share prices rapidly rise to record levels and then subsequently fall to new all-time lows. The Dow soared from 2,753 to 8,000 between January 1990 to July 1997. In October 1997, the events surrounding the
1997 Asian financial crisis plunged the Dow into a 554-point loss to a close of 7,161.15; a retrenchment of 7.18% in what became known as the
October 27, 1997 mini-crash. However, the Dow continued climbing past 9,000 despite negativity surrounding the
1998 Russian financial crisis along with the subsequent fallout from the 1998 collapse of
Long-Term Capital Management due to bad bets placed on the movement of the
Russian ruble. On March 29, 1999, the average closed at 10,006.78, its first close above 10,000. This prompted a celebration on the New York Stock Exchange trading floor, complete with party hats. Total gains for the decade exceeded 315%; from 2,753.20 to 11,497.12, which equates to 12.3% annually. The Dow averaged a 5.3% return compounded annually for the 20th century, a record
Warren Buffett called "a wonderful century"; when he calculated that to achieve that return again, the index would need to close at about 2,000,000 by December 2099.
2000s . Exchanges were closed from September 12 through September 16, 2001. On September 17, 2001, the first day of trading after the
September 11 attacks on the United States, the Dow fell 7.1%. However, the Dow began an upward trend shortly after the attacks, and regained all lost ground to close above 10,000 for the year. In 2002, the Dow dropped to a four-year low of 7,286 on September 24, 2002, due to the
stock market downturn of 2002 and lingering effects of the
dot-com bubble. Overall, while the NASDAQ index fell roughly 75% and the S&P 500 index fell roughly 50% between 2000 and 2002, the Dow only fell 27% during the same period. In 2003, the Dow held steady within the 7,000 to 9,000-point level and recovered to the 10,000 mark by year end. The Dow continued climbing and reached a record high of 14,198.10 on October 11, 2007, a mark which was not matched until March 2013. It then dropped over the next year due to the
2008 financial crisis. On September 15, 2008, a wider
financial crisis became evident after the
Bankruptcy of Lehman Brothers along with the economic effect of record high oil prices which had reached almost $150 per
barrel two months earlier. The Dow lost more than 500 points for the day, returning to its mid-July lows below 11,000. A series of
bailout packages, including the
Emergency Economic Stabilization Act of 2008, proposed and implemented by the
Federal Reserve and
United States Department of the Treasury did not prevent further losses. After nearly six months of extreme volatility during which the Dow experienced its largest one-day point loss, largest daily point gain, and largest intraday range (of more than 1,000 points) at the time, the index closed at a new 12-year low of 6,547.05 on March 9, 2009, its lowest close since April 1997. The Dow had lost 20% of its value in only six weeks. Towards the latter half of 2009, the average rallied towards the 10,000 level amid optimism that the
Great Recession, the
United States housing bubble and the
2008 financial crisis, were easing and possibly coming to an end. For the decade, the Dow saw a rather substantial pullback for a negative return from 11,497.12 to 10,428.05, a loss of a 9.3%.
2010s During the first half of the 2010s decade, aided by the
Federal Reserve's loose
monetary policy including
quantitative easing, the Dow made a notable rally attempt. This was despite significant volatility due to growing global concerns such as the
European debt crisis, the
Dubai World 2009 debt standstill, and the
2011 United States debt-ceiling crisis. On May 6, 2010, the Dow lost 9.2% intra-day and regained nearly all of it within a single hour. This event, which became known as the
2010 Flash Crash, sparked new regulations to prevent future incidents. Six years after its previous high in 2007, the Dow finally closed at a new record high on March 5, 2013. It continued rising for the next several years past 17,000 points until a brief
2015–2016 stock market selloff in the second half of 2015. It then picked up again in early 2016 and climbed past 25,000 points on January 4, 2018. On November 9, 2016, the day after
Donald Trump's victory over
Hillary Clinton in the
U.S. presidential election, the index soared, coming within roughly 25 points of its all-time intraday high to that point. Volatility returned in 2018 when the Dow fell nearly 20%. By early January 2019, the index had quickly rallied more than 10% from its Christmas Eve low. Overall in the 2010s decade, the Dow increased from 10,428.05 to 28,538.44 for a substantial gain of 174%.
2020s Despite the emerging
COVID-19 pandemic, the Dow continued its bull run from the previous decade before peaking at 29,551.42 on February 12, 2020 (29,568.57 intraday on the same day). The index slowly retreated for the remainder of the week and into the next week, before coronavirus fears and an
oil price war between Saudi Arabia and Russia sent the index into a
tailspin, recording several days of losses (and gains) of at least 1,000 points, a typical symptom of a bear market as previously seen in October 2008 during the
2008 financial crisis. Volatility rose high enough to trigger multiple 15-minute
trading halts. In the first quarter of 2020, the DJIA fell 23%, its worst quarter since 1987. The market recovered in the third quarter, returning to 28,837.52 on October 12, 2020, and peaked momentarily at a new all-time high of 29,675.25 on November 9, 2020, at 14:00 ET, following that day's announcement of the success of the
Pfizer–BioNTech COVID-19 vaccine in Phase III clinical trials. On November 24, following news that the
presidential transition of Joe Biden was approved, the Dow increased by more than 500 points, closing at 30,046.24. The Dow (as reported by the United Press International) closed on December 31, 2020, at a record 30,606.48. On January 22, 2024, the Dow Jones crossed 38,000 points for the first time; a month later it surpassed 39,000; and in May, it surpassed 40,000 points. On February 6, 2026, the index crossed 50,000 for the first time. ==Computation==