MARKET SNAPSHOT: Obama Will Need Come-from-behind Win To Post Market Gains
21 January 2009 - 5:08AM
Dow Jones News
By Kate Gibson
With financial stocks dragging down equities as George W. Bush
exited the White House, the market's declines on Tuesday were
emblematic of the reality that Barack Obama's administration is
starting from behind, at least in terms of annualized stock-return
performance.
Bush's final week as president left the Dow Jones Wilshire 5000
Index -- as of Friday's close -- down 5.5% during his second term.
In combination with the 1% gain eked out during his first four
years, Bush leaves office with the stock market down 2.3% over
eight years.
The devaluation of the stocks gauge gives Bush the dubious
distinction of being the first president of the past five to
oversee any decline at all, according to Wilshire Associates.
Ronald Reagan presided over a gain of 12.1% in his first term,
and then a climb of 16.1% during his second, translating into an
overall rise of 14.1% when he left office in 1989.
The downward trend persisted Tuesday, with the Dow Jones
Industrial Average (DJI) falling more than 200 points in early
afternoon trade. At last check, the Dow was off 182.39 points to
8,098.83, with 24 of its 30 components trading lower.
Financials were the heaviest weights on the blue-chip index.
Bank of America Corp. (BAC) dropped almost 19%, while Citigroup
Inc. (C) plummeted about 12%.
The broader S&P 500 Index (SPX) declined 25.14 points to
824.98, with financials again the greatest laggard, led by State
Street Corp. (STT), off 48%, PNC Financial Services Group (PNC),
off 29%, and Bank of New York Mellon Corp. (BK), off nearly
26%.
The Nasdaq Composite Index (RIXF) shed 51.92 points to
1,477.41.
In his one and only term as president, the first President Bush
presided over a 14.5% advance in annualized returns on the DJ
Wilshire 5000.
Bill Clinton had the best results overall, at least in looking
at yearly returns from the broad market gauge. The Wilshire rose
17.7% during his first term, which ended in 1997.
Of course, Clinton fared less well, both in political and in
Wall Street terms, during his second term. Yet the index still
climbed 13.5% for a collective 15.6% during his eight years in the
Oval Office.
While Obama has not yet been sworn in as the nation's 44th
president, the global equities market was already off to a
less-than-solid start for the year. January is showing "scary
similarities to last January," according to Howard Silverblatt,
senior index analyst at Standard & Poor's.
Last year, January 2008 posted one of the worst months, up to
that point, with global markets declining 8.39% and losing $3.28
trillion.
For the first half of this month, according to Silverblatt, the
global market losses came to $1.23 trillion.
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