The stock market just booked its ugliest Christmas Eve plunge in history
Never mind finding coal in your stocking for the holidays. Wall Street investors scored a rare — and unwanted gift this year.
The S&P 500 index
fell by 2.7% Monday, marking the first Christmas Eve that the broad-market benchmark has booked a loss of 1% or greater — ever.
The Dow Jones Industrial Average
also marked its worst drop on the ever of Christmas, finishing 653 points, or 2.9%, representing its worst such decline in history.
Bespoke Investment Group spotlighted this dubious S&P 500 record earlier in the day:
Prior to 2018, the S&P 500 had never declined more than 1% on the last trading day before Christmas.
— Bespoke (@bespokeinvest) December 24, 2018
That statistic has been confirmed by Dow Jones Market Data, which said the largest decline in the index on the trading day before Christmas was Dec. 23 in 1933.
The following graphic from Bespoke illustrates the index’s moves over the past 90 years or so:
For the Dow, it would be the first time it has fallen by more than 1% in about 100 years and the steepest drop on Christmas eve in the 122-year-old blue-chip gauge’s history : Check out the table below from Dow Jones Market Data:
It wasn’t pretty for the Nasdaq Composite Index
either, with the technology and internet-laden benchmark logging an ugly 2.2% loss. That also marks the worst Christmas eve drop for the Nasdaq its history, with the worst drop a 0.95% in 1973. The Nasdaq began trading on Feb. 8, 1971.
U.S. stock indexes ended trading at 1 p.m. Eastern Time on Christmas Eve and will be closed on Christmas.
The current dynamic in the market has it set for its worst monthly and yearly decline about a decade, amid nagging concerns that the Federal Reserve is normalizing interest rates too rapidly, and that a continuing tariff dispute between China and the U.S. could devolve and help lead to a domestic recession, as international economies are already demonstrating signs of a slowdown.
Also stoking anxiety was a tweet from Treasury Secretary Steven Mnuchin to assess the health of the banking system, which has raised some questions about liquidity among those institutions that had not previously been raised. Treasury officials insist that the calls to bank executives was just a routine checkup.