The Dow Jones Industrial Average: The Market’s MeasureIn 1896, Charles H. Dow developed what is today known as the Dow Jones Industrial Average (DJIA). It was composed of 12 companies that were traded on the New York Stock Exchange. By watching this “average” of the prices of a dozen large and diverse stocks, investors were able to gauge how the entire market was doing.
The DJIA and its sister index, The Dow Jones Transportation Average, gave new credibility to the stock market. Dow’s inventions made investing more understandable and accessible to individuals who previously were unsure or untrusting of it.
Though it has changed greatly over the years—including expanding to 30 companies and using much more complex methods to calculate and deliver its values in real time — “The Dow” remains the world’s single most-quoted and most-watched index. It has truly become “the market’s measure” for investors around the globe.
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8776.39Close of DJIA 12/31/08
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Emergency rule imposed in Pakistan
9/11 Commission Report Published
George W. Bush re-elected
AIG, Pfizer and Verizon join The Dow
Tsunami kills 310,000 in Asia
Pope Benedict XVI elected
Terrorists bomb London
Hurricane Katrina slams Gulf Coast
New Fed chairman
"An Inconvenient Truth" released
Saddam Hussein sentenced to death by hanging
Democrats win control of both House and Senate
iPhone unveiled
War in Iraq
President Bush announces plans for Iraq troop surge
New Century Financial files for backruptcy
2008
Fidel Castroannounces resignation
Bear Stearnscollapses
Beijing Olympics
Federal takeover of Fannie Maeand Freddie Mac
Fed lends $85 billion to AIG
Earthquake in China kills 70,000
Lehman Brothers files for bankruptcy protection
Bush signs plan creating $700 billion TARP
Barack Obama elected President