Charles H. Dow, co-founder of the Wall Street Journal, once said:
“For the past 25 years the commodity market and the stock market have moved almost exactly together. The index number representing many commodities rose from 88 in 1878 to 120 in 1881. It dropped back to 90 in 1885, rose to 95 in 1891, dropped back to 73 in 1896, and recovered to 90 in 1900. Furthermore, index numbers kept in Europe and applied to quite different commodities had almost exactly the same movement in the same time. It is not necessary to say to anyone familiar with the course of the stock market that this has been exactly the course of stocks in the same period ( source: Dow, Charles. Review and Outlook. Wall Street Journal.February 21, 1901.)”
There is no exactness between the relative percentage change in the Dow Jones Industrial Average and the price of a commodity like gold. However, since the January 26, 2018 peak in the DJIA, there has been a lot of sympathy moves in the price of gold and the DJIA.
