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why does the Dow Jones reading change from the end of trading one day to the start of trading another day.?
Question by thewayhome: why does the Dow Jones reading change from the end of trading one day to the start of trading another day.?
For example at the end of trading on a Friday the Dow Jones sat at 13442. Yet at the start of foreign trade early Monday morning before the stock markets open in New York it now reads 13536 yet at that time it shows a loss of roughly 20 points. How can the Dow Jones level be higher when there has been a loss from the end of trade one day to the start of another. I have noticed this before that the Dow is stated to end the day at a particular level, yet when trading begins, even with a loss, it is still higher than the end of the previous day. Can you explain the difference in its level from the end of one day to the start of the next without the markets being open.
Best answer:
Answer by jeff410
Because orders for the stocks on the Dow are placed between the time it closes the previous day and the time it opens the following day. That creates a backlog that has to be balanced by the specialists and market makers. Its kind of like a checking account with checks and deposits that have come in over night. Especially electronic deposits that clear after business hours. The opening balance today isnt going to be the same as the closing balance yesterday.
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Tags: Jones, Trading, day., start, FROM