Whipsaw Moves
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What's Happening Today Good morning! It's Kristin with your daily morning digest.
Anyone watching the markets yesterday got to witness firsthand the wild ride that stocks took investors on during the trading session. After dropping over 1,100 points, the Dow charged back to end the day almost 100 points higher, in a sudden and drastic pivot in the opposite direction that investors call a "whipsaw." Cryptocurrencies are also recovering, with the price of Bitcoin back on the rise, above $36,000 after falling below $33,000 for the first time since July.
But just because the major U.S. equity market indexes finished in the green yesterday, doesn't mean that investors can expect another surge today. The Dow, S&P 500, and Nasdaq are already falling today as the Federal Reserve kicks off its two-day meeting, and investors wait for clues from Fed Chair Jerome Powell about when the central bank will raise interest rates. It's expected that after the meeting concludes, the Fed will announce an interest rate hike to start in March, which could lead to more volatility in the markets.
So what's the big takeaway? Market declines do happen, but they are not always cause for panic and selling off your investments. If you sell everything, you could miss out on big gains if the market bounces back from its lows. In fact, temporary declines can be viewed as buying opportunities. As billionaire businessman Warren Buffett has said, "get greedy when others are fearful." And of course, we'll be here to help you make sense of it all.
- Kristin Editors' Picks
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