On This Day In Market History: The Attack On Pearl Harbor
|Each day, Benzinga will take a look back at a notable market-related moment that happened on this date.
What Happened?
On this day 76 years ago, Japan attacked the U.S. naval base in Pearl Harbor, Hawaii at 7:48 a.m. local time on a Sunday morning.
Where Was The Market?
The stock market was closed on the day of the attack, but the Dow Jones Industrial Average closed the Friday prior to the attack at 115.90.
What Else Was Going On In The World?
The average American earned $1,750 per year in wages, and a gallon of gas cost about 12 cents.
‘A Date Which Will Live In Infamy’
The Monday following the attack, the Dow plunged 3.4 percent to 112.53 as President Franklin D. Roosevelt declared war on Japan. The sell-off continued on Tuesday with another 2.89 percent drop. U.S. stocks bounced back a bit in the days that followed, but stocks continued to endure selling pressure until the U.S. secured a naval victory in the Battle of Coral Sea in May of 1942. Prior to the victory, the Dow hit 92.69, its lowest level since 1934.
Following the victory, investors gained confidence that the U.S. victory would be close at hand. Unfortunately, Japan didn’t surrender until Sept. 2, 1945. Still, U.S. stocks continued to rally, gaining more than 130 percent in a four-year stretch. The rally ended in 1945 following the end of World War II when the U.S. Federal Reserve began to raise interest rates.
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