The Dow Jones Industrial Average is facing a tough time, and it’s at risk of its longest losing streak since the 1970s. As of Tuesday, the Dow had dropped for eight days in a row, falling by around 250 points, or 0.6%, during midday trading.
If this losing streak continues, it will be the longest for the Dow since February 1978, according to data from FactSet. However, despite the recent downturn, the losses have been relatively small—just 3% over the last eight days. So, it’s still a small dip in the grand scheme of things.
Interestingly, the Dow’s struggles are not being felt across all markets. While the Dow is down, other indices like the Nasdaq, boosted by strong performances from big tech companies and the artificial intelligence boom, are doing well. The Nasdaq hit new highs, and the S&P 500 also gained on Monday.
“There’s a clear trend toward technology stocks right now,” Keith Lerner, co-chief investment officer at Truist Advisory Services, told CNN. “AI and tech are the main drivers of this market.”
One of the biggest contributors to the Dow’s recent losses is UnitedHealthcare Group. The insurance giant has seen its stock fall 18% this month, partly due to the tragic death of its CEO, Brian Thompson. On top of that, President-elect Donald Trump’s comments about tackling the drug industry have led to further drops in the company’s stock price.
The Dow’s current losing streak is the longest since 2018 and comes just ahead of the Federal Reserve’s interest rate decision on Wednesday. Investors expect the Fed to cut rates by a quarter point, but they’ll also be watching for hints that the pace of cuts could slow next year.
Despite the recent losses, the Dow is still up by 16% this year and remains about 1,500 points (or 3.5%) higher than it was on Election Day.
Markets initially rallied after Trump’s victory, with investors relieved that the election process was smooth and without major disputes. There was also optimism about Trump’s promises to cut taxes and reduce government regulations.
However, there are growing concerns about some of Trump’s more aggressive policies, such as the threat of higher tariffs and mass deportations, which may be spooking the markets. “After the election, investors focused only on the positive side of Trump’s plans. Next year, they’ll need to weigh both the good and the bad,” said Lerner.
So far, the Dow hasn’t experienced a losing streak longer than eight days since 1974, when it fell for 11 straight days.
Anthony Saglimbene, chief market strategist at Ameriprise, doesn’t think the recent losses are a sign of deeper problems. He believes it’s more of a natural pullback after strong gains in recent weeks. There’s also been a shift in expectations about the risks and rewards of Trump’s policies.
