The Dow Jones Industrial Average pushing past 50,000 for the first time last Friday, February 6th deserves recognition. The DJIA average spent a few days above that record level and now hovers just below at 49,500. Where does the US stock market go from here?*
Keeping in mind the Dow Jones index contains only 30 large US company stocks, looking at the US stock market in terms of the S&P 500 index (500 large US company stocks) is similar and may offer slightly broader perspective. Let’s briefly go back to the dot-com bust of 2000 and the Global Financial Crisis of 2007.
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- Back in March of 2000 (wow, that is a long time ago) the S&P 500 index reached a peak of 1,552 (yes, ONE thousand five hundred fifty-two) …and then came the dot-com bust. Fast forwarding, the index took seven (7!) and a half years to reach that level again, reaching 1,565 in October of 2007**.
- The index immediately fell into what became the Global Financial Crisis (GFC) which lasted two years, with further market declines and a crisis low in March of 2009. The index then worked its way back over four (4) years to a new high in March of 2013.
Index returns have been almost straight up since then, with several inevitable hiccups during the way: notable were the relatively brief intra-year coronavirus decline in 2020, and the down year due to interest rate hikes to fight inflation in 2022.
All of these details are to say that both market records and market declines happen.
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- Reactions and interventions by the US Federal Reserve can address market crises and contribute to market recoveries — and can take years.
- Dividends and dividend-paying stocks can and did accelerate total returns amidst market volatility and the delay of these market recoveries.
- Looking ahead: breakthroughs in AI (artificial intelligence) are likely to fuel periods of sharp market swings—driven in part by uncertainty around what certain AI technologies actually are —while also unlocking powerful, long-term growth as AI streamlines operations and enhances productivity across the economy and key industry sectors.
Stay tuned and stay in touch.
*Answer: no one knows for sure, but we can use history as a rough guide.
**The S&P 500 closed Friday, February 13, 2026 at 6866.78, or about 4.37 times where it closed in early March 2013. The Dow Jones closed Friday, February 13, 2026 at 49,652.43, or about 3.5 times where it closed in early March 2013.
Consult with a tax professional on ALL tax matters and tax planning. This material has been prepared for informational purposes only and is not intended to provide, and should not be relied upon for, tax, legal or accounting advice.