The electric car maker jumped 743.4% in 2020 for the biggest gain in the S&P 500. Along the way, they helped power shares in companies like Tesla to new heights. Individual investors, sometimes referred to as retail investors on Wall Street, hopped onto the market rally via commission-free online trading platforms like Robinhood. From there, markets disconnected from the rest of the still-reeling economy and pushed higher in fits and starts as vaccine development progressed and analysts and economists looked ahead to the eventual end of the pandemic.Įven as the stock market charged ahead as the fortunes of larger companies improved, millions remained out of work and many small businesses around the country, such as bars and restaurants, remained shuttered or limped along at a fraction of their usual capacity. Investors also flocked to big technology companies such as Apple and Amazon and smaller companies like Grubhub and Etsy that were poised to take advantage of the shift to working and shopping from home. Wall Street’s recovery was due in large part to unprecedented actions from the Federal Reserve and Congress to support the economy. “It was probably very hard to imagine getting those back in such a short period fo time,” said Shawn Cruz, senior market strategist at TD Ameritrade. Five months later, the market recouped all of its losses. The wave of selling accelerated as the economic fallout from the pandemic widened, leaving many long-term investors looking on as their gains after a blockbuster 2019 for stocks evaporated. The VIX, which measures how much volatility investors expect from the S&P 500, climbed to a record high 82.69 in March and remained above its historical average for much of the year. And the S&P 500 rose or fell by at least 1% on twice as many days in 2020 than it did, on average, since 1950. The Dow had several day-to-day swings of about 2,000 points. The dire economic situation weighed heavily on almost any company that relied on direct consumer spending or a physical presence, including airlines, restaurants, hotels and mall-based retailers.
People shifted to working, shopping and doing pretty much everything else from home. Businesses shut down in the face of the virus threat and tighter government restrictions. The S&P 500 fell 8.4% in February, then plunged 12.5% in March as the pandemic essentially froze the global economy. The virus pandemic shocked markets early in the year. S&P 500 ends at another record high as tumultuous 2020 ends