Recent Stock Market Decline May Be Result Of Surge

By Matthew Kling
Published: Tuesday, February 6, 2018 - 5:10pm

After three days of significant losses on Wall Street, U.S. markets rebounded on Tuesday, with the Dow Jones Industrial Average gaining 567 points.  The losses caused concern for some, but one local expert says don’t fear daily stock market turbulence.

Financial analysts are blaming the recent stock market plummet on factors such as rising wages and interest rates, and even on computer algorithms. But one professor from the University of Arizona argues differently.

Christopher Lamoureux is a finance professor at U of A’s Eller College of Management. He suggested that the market’s surprise surge in December and January led to the eventual market declines.

“Greed starts to take over and money is almost drawn in like a magnet," Lamoureux said, "as people realize the market has been going up and they might be missing out. That usually is going to be reversed.”

Lamoureux added that the recent volatility won’t hurt publicly traded companies with large Arizona operations such as Intel and Freeport-McMoRan in the long run.

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