A chart shows how each industry contributed to the average since 1992. (S&P Dow Jones Indices)
A somewhat tumultuous year in American history, 1896 saw two presidential candidates fight over the gold standard and other economic issues. Resulting anxiety wiped over 30% from the index created by Charles Dow and Edward Jones just months earlier. Since then the Dow Jones Industrial Average has spent 120 years monitoring the market’s ups and downs. S&P Dow Jones Indices celebrated the anniversary on May 26.
Charles and Edward began with the 11-stock Dow Jones Railroad Average, since evolved into the Dow Jones Transportation Average. The index complemented their Customer’s Afternoon Letter, the precursor to The Wall Street Journal. The DJIA began with 12 stocks, grew to 20 in 1916 and reached the present level of 30 in 1928. Nasdaq stocks joined the list in 1999, towards the end of the index’s best decade. Not exactly open to junior explorers, listings are limited to large- and mega-cap companies, averaging $86.08 billion on March 31 compared with $37.37 billion for the S&P 500.
Of the original dozen companies, General Electric is the only survivor under the same name, although its place on the index hasn’t been continuous. GE was dropped twice prior to 1907.
Although the index took 76 years to close on 1,000 points, it took less than a year to bolt from 9,000 to 10,000 in 1999. That same year the DJIA took just 24 days for another 1,000-point jump to 11,000. The speed of each 1,000-point climb continues to accelerate.
A bi-polar year, 2008 recorded five of the benchmark’s 10 best days and four of its worst by points. By percentage, the early Depression years of 1929 to 1933 held seven of the 10 best days and five of the worst.
Long gone are the days of Arthur “Pop” Harris who “would pull ticker tape from the machine, bloodying his hands while furiously calculating the gauge on which the markets hung,” according to an S&P commentary. “By contrast, S&P Dow Jones Indices—the owner and publisher of the DJIA—now calculates over one million indices using an advanced calculation platform with operation centres around the globe.”
Commemorating the anniversary while symbolizing market swings, green and red lights blazed on the Empire State Building the night of May 25. Honchos from S&P and some DJIA companies will ring the May 26 NYSE closing bell.
Read more at the original source. http://resourceclips.com/2016/05/26/the-dow-celebrates-its-120th-birthday/