Stock market plunges in the new year - WFSB 3 Connecticut

Stock market plunges in the new year

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Stock market plunges in the new year (WFSB) Stock market plunges in the new year (WFSB)
HARTFORD, CT (WFSB) -

It has been a wild ride on Wall Street, as the DOW closed down more than 270 points on Monday.

It hasn’t been this bad on Wall Street on the first day of trading in 84 years.

All day on Monday, many of the stocks had downward arrows, which could impact everyone.

“It’s a huge wake-up call,” said Joel Johnson, of Johnson Brunetti Retirement and Investment Specialists.

Many investors woke up to find the stock market in Shanghai had dipped to a 7 percent, triggering a circuit breaker.

“They have things in their markets like we do in the U.S. called circuit breakers, where if the markets start selling too fast they take a time out. They shut off market for a half hour,” Johnson said.

Even though Americans continue to buy many Chinese goods, like clothing and toys, their economy isn’t doing well as ours.

“China's current is weak. It's not acting like the Chinese government wants it too, plus their manufacturing is slowing down. That sends a ripple effect through the markets,” Johnson said.

In response, many investors in the United States started selling off stocks on the New York Stock Exchange, forcing it to nosedive.

Johnson said the down day on Wall Street is also reflective of what is going on in the Middle East.

“The big face-off between Saudi Arabia and Iran. It's got a lot of investors wondering ‘what if something escalates’,” Johnson added.

Even if you don’t own stock, you could be impacted.

“We are a consumer-driven economy. If Americans stop spending money on the things we spend more on, that sends our economy into a recession,” Johnson said.

If you have a retirement account like a 401k, Johnson said if you have a good plan, stick with it and continue to save.

Usually during a presidential election year, the stock market is volatile. There could be another down day on Tuesday.

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