Why is the market fixated on the dow?

[markrmau]

Why is the market fixated on the dow? (which is an index comprised of 29? companies)

I'm sure 50yrs ago, it was an easily calculated index that could be used as a barometer for the US market health. But these days? Surely the S&P500 would be more appropriate.

Crikey, GM is even in the Dow. What happens when it files for chapter 11 sometime in the next year or two?

 

[wayneL]

Journalists are fixated on the dow

Traders aren't, they couldn't give a stuff...unless trading dow futures.

You are right about s&p500, that's what traders follow.....that and the NASDAQ .

 

[Aussiejeff]

Perhaps unfortunately in many ways, the world's stock markets appear to be inextricably tied to an ageing old dog - the US markets & economy. When the US goes to sleep, so does the rest of the world.

Given that some recent predictions claim the US under it's current leadership (both political and financial) is going backwards and likely to be overtaken economically in the somewhat near future by China, India et all - I wonder if the World's Financial Mass Media And Mega-Traders can pull their collective one-eyed heads out of Uncle Sam's backside and maybe look in other more profitable and sustainable directions? Hmmm. I personally think that's asking for an AWFUL LOT!

The financial world has hitched it's wagons to Uncle Sams gung-ho Wild West Circus Train and I believe we are going to go inexorably along for the ride for better or for worse. We could have a booming economy with great companies and profits yet blind freddies will continue to sink vast Trillion$ of Mega-bucks into the US - even if they risk losing big-time - because it was the first and the bestest stock market of all time. I reckon it takes a LOT of personal pain and anguish before many people will change allegiance from Cadillacs to Hyundais.....

The market pickings from here if the US is really starting to buckle long term may be slim indeed. Make the most of what opportunites do come along. My cash reserves earning 5.5% interest PA are suddenly looking more attractive by the day!

In fact, I think its time to divest what remains of my shares portfolio and top up the cash reserves again in anticipation of an eventual turn-around and some short term value-buying / profit taking opportunities.

Happy trading folks,

AJ