Every day on the news you hear about the Dow Jones Industrial Average, and other averages like the S&P 500 or The Russel 2000. These are broad market averages designed to tell you how companies traded on the stock market are doing in general. For example, the Dow Jones Industrial Average is simply the average value of 30 large, industrial stocks. Big companies like General Motors, Goodyear, IBM and Exxon are the companies that make up this index (this page tells you which companies are currently in the Dow Jones average). The S&P 500 is the average value of 500 large companies. The Russel 2000 index averages the values of 2,000 smaller companies.
Wall Street's bronze bull, by Arturo De Modica, located at the northern tip of Bowling Green
What these averages tell you is the general health of stock prices as a whole. If the economy is "doing well," then the prices of stocks as a group tend to rise in what is referred to as a "bull market." If it is "doing poorly," prices as a group tend to fall in what is called a "bear market." The averages reveal these tendencies in the market as a whole.
Wall Street's bronze bull, by Arturo De Modica, located at the northern tip of Bowling Green
What these averages tell you is the general health of stock prices as a whole. If the economy is "doing well," then the prices of stocks as a group tend to rise in what is referred to as a "bull market." If it is "doing poorly," prices as a group tend to fall in what is called a "bear market." The averages reveal these tendencies in the market as a whole.
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