Mar 19, 2020 - Economy & Business

The market is not quite as bad as the Dow makes it look

Data: FactSet; Chart: Axios Visuals
Data: FactSet; Chart: Axios Visuals

One high-profile group of stocks has been doing particularly badly during the coronavirus crisis — the 30 companies that make up the Dow Jones Industrial Average.

The state of play: The Dow stocks are down 33% over the past month, compared with a 30% decline for the S&P 500, and a 24% drop for the more tech-focused Nasdaq. On up days and down days the Dow has generally underperformed the market as a whole.

Why it matters: The Dow is often the first indicator that Americans look to when they want to understand what's happening in the stock market. But the Dow companies represent only a small minority of U.S. stock-market capitalization.

  • The Dow is an average rather than an index, which means companies with higher share prices have outsized influence on its moves.
  • In particular, Boeing has weighed heavily on the Dow.
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