Stocks tumbled in early trading on Tuesday following economic turmoil overseas before recovering most of their loses by day’s end.
Markets plunged at the opening bell following a massive sell-off in China caused by new government regulations around short-term credit purchases. Meanwhile, the Greek stock exchange fell 12% – the country’s largest one-day stock drop in nearly three decades – on news that Greece will hold an early presidential vote, raising fears that a win by the country’s left-wing political party could jeopardize the nation’s economic bailout.
Those losses proved contagious globally, with markets across Asia and Europe declining in Tuesday’s trading.
In the U.S., the Dow Jones Industrial Average plummeted more than 220 points in early trading before rallying throughout the afternoon. The blue-chip index finished the day down 51 points, or 0.3%, to 17,801. The S&P 500 fared better, managing to finish nearly flat. And, the Nasdaq composite posted a modest gain, rising by 0.5%.
The market turmoil on Tuesday followed on the heels of a weak showing a day earlier. The Dow Jones fell more than 100 points, or 0.6%, on Monday while the S&P fell 15 points, or 0.7%, and the Nasdaq lost 40 points, or 0.8%.
Last week, the Dow Jones came within less than 9 points of hitting the 18,000-point mark for the first time ever. That would have been this year’s second major milestone for the index, which crossed the 17,000-point mark for the first time in July.
The market has endured a roller-coaster ride in a second half of the year, including a broad sell-off in October that basically erased all of the year’s gains and sent the Dow Jones tumbling below 16,000 points, briefly. Stocks have rebounded since then with a string of record finishes pushing the Dow Jones and S&P 500 to all-time highs.
Even with the losses to start this week, the Dow Jones is up more than 7% from the start of the year. The S&P 500 is up 11.4% on the year and remains within 25 points of its all-time high while the Nasdaq has gained about 14% this year and remains near its highest point since 2000.