Investors are looking for opportunities to buy and sell stocks in a market that has been rattled by the threat of a global pandemic.
The US stock market has been under intense pressure from fears the pandemic could be the catalyst for a sudden spike in the prices of goods and services.
The Dow Jones Industrial Average and the S&P 500 have both traded above 20,000 since Monday.
The Nikkei 225 Index has dropped more than 10% this week.
On Wednesday, the Chinese government said it had suspended trading in stocks in the country after authorities warned traders that an “unprecedented” level of panic was brewing.
The warning came just two days after Beijing suspended trading of stocks in other markets in the wake of an unprecedented surge in the number of people killed in the coronavirus pandemic, the country’s largest ever.
The government said the “market panic” was caused by “the spread of the virus,” and the government was preparing to declare a state of emergency in the affected regions.
China is not the only nation with the potential for a “market crisis” — the Shanghai Composite Index has been on a tear for several months and has gained more than 500% this year.
China’s stock market woes are likely to spark further capital outflows from the country and a sharp increase in inflation, but analysts say they do not yet appear to be as dire as they were before the pandemics began.
“It’s been a very strong year for the stock market,” said John Kilduff, a senior fellow at the Peterson Institute for International Economics.
“There’s been no shortage of news of investors buying and selling stocks, and investors are looking to capitalize on those opportunities.”
Kilduff said he believes the market is starting to come around from a “very deep and long” hole that had opened up around a quarter century ago.
In the past year, many companies have been forced to raise prices and reduce dividends, and the Dow Jones industrial average has fallen more than 25% in the past 12 months, while the S & P 500 index has fallen nearly 20%.
“It hasn’t been like a full-blown market collapse, but there have been some big shifts that have happened,” Kilduf said.
“We’ve seen some of the biggest changes.”
But the pandems have created a lot of uncertainty, he added.
While stocks have fallen, some investors have been buying up stocks that are not performing well.
“The Dow has done a really good job of staying ahead of the market and that has allowed it to be a great performer,” Kain told CNNMoney.
But for the time being, he believes that investors have only been able to buy a small portion of the stocks that have done well and have been selling them.
“I think the majority of investors have just been sitting there waiting for the next one to fall,” he said.
“We’re starting to see some of those companies that are doing well start to fall.”