Pearl Harbor Remembered: Market Reaction to That Infamous Day

It was near 70 degrees and partly cloudy in Honolulu on the morning of Sunday, Dec. 7, 1941. Just prior to 7:50 a.m.–the time when the Japanese pilots began their assault—U.S. military personnel and their families lay fast asleep after a Saturday night on the town. The next day, President Roosevelt addressed Congress and uttered the famous phrase, “A date which will live in infamy.” The United States was at war. In the wake of the attack, Pearl Harbor, and America for that matter, would never be the same.

The sad irony is that Americans held a strong “isolationist” belief at the time, and had it not been for the vicious assault on the U.S. naval base at Pearl, our introduction into WWII may have been delayed, perhaps even avoided.

For the 12 months prior to the attack, the average daily trading volume on the Dow Jones Industrial Average was about 560,000 shares. During the following three weeks, trading volume nearly tripled to 1.6 million shares per day. What was a bit surprising was its performance.