The past week may have included a long holiday weekend, which some people lazily spent leisurely grilling in their backyards, but the holiday-shortened past week in the markets has been the exact opposite for market participants, if not totally downright frightening.
The Nasdaq, for example, hit a fresh all-time record high just last Wednesday, and the very next day began plunging, falling by over 10% in the last three trading days. The S&P plunged too, but peak-to-trough, we're talking about a drop of just over 7%, and the Dow is down just over 5% after breaching 29,000 to the upside for the first time ever.
What has happened over the last week that has caused such a plunge, and how do we know if the plunge is over or if it will continue?
In my opinion, there were two main drivers of the most recent stock market plunge, and in no particular order, those two drivers would be the Covid-19 vaccine disappointment and the fiscal stimulus stalemate.