As the COVID-19 pandemic continues to spread around the globe, . The measures taken by world governments to contain the pandemic have led to a drop in the value of tourism-related companies, like those owning cruise ships and airlines. As mass gatherings are canceled and schools are closed, other industries are sure to also feel the economic impacts of the pandemic. So what has Wall Street done during other pandemics?
2009 H1N1 Influenza Pandemic
The first human case of H1N1-pandemic . That morning, the Dow Jones Index opened at 7,914 points and closed at 8,029 points. The Centers for Disease Control and Prevention made the announcement on April 21, 2009. That day, the index went from 7,841 to 7,969. The World Health Organization declared a Public Health Emergency of International Concern (PHEIC) on April 25. The index closed at 8,025 on April 27, the first full day of trading after the announcement. As the pandemic developed and more cases were reported around the world, the stock market remained relatively stable. This was the case even as control measures similar to those being seen today with COVID-19 were put into place: gatherings were canceled, schools were closed and household supplies were hoarded by the population. The Dow closed at 10,548 on the last day of trading for 2009, .1918-1919 Spanish Flu Pandemic
During the 1918-1919 Spanish Influenza Pandemic, the stock market was also relatively stable. :“However, the impact of the Spanish Flu on the stock market was minimal. If you look at the Dow Jones Industrial Average in 1918 and 1919, you can see that the stock market was relatively unaffected by any of the three waves of the Spanish flu. Of course, the Spanish flu occurred in 1918 while World War I was raging in Europe so the war had a larger impact on the stock market than the flu. There were few if any global supply chains that the Spanish Flu could disrupt because the war made supply chains nonexistent. The second and worst wave of flu occurred at the end of World War I when peace was finally achieved after four years of devastating destruction. It is interesting that there was little impact on the stock market of World War I ending on November 11, 1918. Perhaps euphoria about the conclusion of the war was offset by concerns about the Spanish flu. It is comforting to see that when the final wave of the Spanish flu subsided in February 1919, the market began an increase of 50% which lasted until November of 1919. Whether this increase occurred because of the end of World War I or the end of the flu or both is impossible to say, but it does provide encouragement that once the coronavirus begins to subside, the market will bounce back once again.”