I'm not a huge believer in extrapolating small sample sizes, but per Claude there have been 9 incidents since 1960 of a 2 day drop of 10%.
In 7 of 9 the market is up the following day. What I thought was interesting is 3 months later and 9 months later it was still 7/9, and the two that were down were the same ones down the next day.
If you believe in the power of extrapolation it suggests tomorrow will be pretty important. I have not validated these results myself so assume all due caveats associated with hallucinating AI.
| Incident | Initial 2-Day Drop | Next Trading Day |
|----------|-------------------|-----------------|| May 28-29, 1962 (Kennedy Slide) | -12.8% | +4.7% || May 28-29, 1970 (Cambodia Invasion Reaction) | -10.2% | +3.1% || November 18-19, 1973 (Oil Crisis) | -10.3% | -1.2% || October 9-10, 1979 (Volcker Policy Change) | -10.1% | +1.0% || October 19-20, 1987 (Black Monday) | -28.5% | +5.3% || October 26-27, 1987 (Black Monday Aftershock) | -10.0% | +2.8% || November 15-16, 1991 (November 1991 Drop) | -10.1% | +1.9% || September 29-30, 2008 (Financial Crisis) | -10.9% | -1.4% || March 12-13, 2020 (COVID-19 Crash) | -12.9% | +
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