On April 28, 1942, five months after the attack on Pearl Harbor, President Franklin Roosevelt went on the radio to give his 21st fireside chat. There wasn't much positive he could say about the war. The Soviets had counterattacked Germany's eastern offensive, but Russian victory looked far from certain. In Asia, the Allies had lost most of the Philippines, Singapore, Malaysia, and the Japanese were driving into Burma. The president called on the American people to exercise self-denial even as he warned of more government spending and higher taxes. The S&P that day sank to 7.47 – lower than its nadir in 1935.
But the gloom began to lift almost immediately. Within a week the battle of Coral Sea demonstrated that the Japanese navy was not unstoppable. The battle of Midway a month later turned the tide decidedly toward the Americans in the Pacific. By late August, the battle of Stalingrad was under way and would prove a decisive defeat for Germany. The US stock market climbed through the rest of the war, peaking in 1946 at more than double the value it had in April 1942.