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How bad a day was it? Well, at one point during the session 1.46 billion of the 1.5 billion shares traded were on the downside. That's a 50-to-one ratio in favor of declining volume - the widest spread since 1997. As explained by MarketBeat's David Gaffen, these massive down days are often not just isolated incidents. Going back 30 years, they can be a harbinger of uglier times ahead - or in some cases, huge rallies. Jason Goepfert, president of Sundial Capital Research, notes that this lopsided up-down volume on Oct. 16, 1987 led to the market's big crash three days later. On the positive side, on Oct. 19, 1997, when the Dow finished down about 80 points with the same kind of lopsided volume, the market took off in the weeks following. But not before another terrible day when the Dow lost more than 550 points. From MarketBeat:
So what’s going to happen this time? Of course, Mr. Goepfert can’t answer that question yet, but clues will come in the next few days. “Heading into tomorrow we’ll be watching for signs of a reversal,” he says. “Whether people should put money to work, we can’t say that yet. In the past, when it did keep declining, the declining happened right away, but if there was a reversal there was time to get in. If it doesn’t, it could get much worse from here.”
If you're keeping track of the numbers, it was the seventh-worst day on the Dow in terms of point losses, and the worst day in five-and-a-half years. It was also the biggest percentage drop since March 24, 2003, though nowhere near the 22.6 percent plunge on Oct. 19, 1987. By the way, that sudden, sharp decline in the Dow at around noon - 200 points almost instantly - was the result of a tabulation delay by Dow Jones data systems. Basically, there was such a surge in order flows that DJ switched to a backup system to calculate the average - and it instantly added 200 or so points to the loss column.
As for local stocks, virtually everything was down (by percentages that were fairly close to the indexes). One stock that stood out was Disney, down 5.72 percent. Here's a sampler:
Amgen -2.95%
Activision -3.19%
Cheesecake Factory -3.16%
CB Richard Ellis -5.21%
Countrywide -2.94%
California Pizza Kitchen -3.61%
Disney -5.72%
DreamWorks -3.04%
DirecTV -4.83%
Edison -2.56%
Guess -1.82%
Hilton -3.52%
IHOP -3.51%
KB Home -3.71%
Mattel -1.50%
Mossimo +0.95%
Maguire Properties -2.39%
Skechers -4.58%
Stamps.com -4.97%
THQ -1.82%
Mark Lacter created the LA Biz Observed blog in 2006. He posted
until the day before his death on Nov. 13, 2013.