Wall Street's wild ride began on Dec. 17, with the S&P 500, Dow and Nasdaq all dropping more than 2 percent. Fears of a slowing economy and worries over the course and speed of Federal Reserve monetary policy pressured stocks that day.
19, Fed fears came to head after Chairman Jerome Powell said he did not anticipate the central bank changing its strategy for trimming its massive balance sheet. Those comments pushed down the broad indexes down another 2 percent that day. Stocks again fell sharply later in the week as the likelihood of a U.S. federal government shutdown increased. Congress and the Trump administration failed to reach agreement on funding for a wall along the US-Mexico border. President Donald Trump said the wall was key to national security, while opponents of the barrier did not want to solve the immigration issues plaguing both countries.
percent. The Dow, meanwhile, dropped 6.9 percent.
All of these concerns set the stage Monday for the worst Christmas Eve in the U.S. stock market. The Dow and S&P 500 both fell more than 2.5 percent while the Nasdaq slid 2.2 percent. The S&P 500 also entered the bear market market on Monday. "It was the perfect storm or negativity," Chaikin said. "What I think has been a crisis of confidence in Washington. It's sort of unprecedented and so the extremes are all at bear-market low extremes."
"There's been panic and fear.
These moves took place against a backdrop of economic uncertainty as a series of leading indicators showed signs of a slowdown.
On Dec . 1[ads1]4, IHS Markit said its U.S. Pat. composite output index fell to 53.6 for December, a 19-month low. IHS Markit's services and manufacturing PMIs also dropped to their lowest levels in about a year. A reading above 50 represents expansion
"The markets are grappling with solid US earnings and solid concurrent economic indicators. That's the good news," said Dave Haviland, managing partner at Beaumont Capital Management. "But that's getting pitted against significantly poor or significantly leading economic indicators here at home and significantly worse performance overseas." "We've got a lot of the ingredients for re-pricing and that's basically what the markets are. going through, "Haviland said.