The Longest Bull Market In History Is Over As S&P Suffers Worst Christmas Eve Crash On Record

The S&P crashed to 2,351.10, closing below its bear market level of 2352.7 - the lowest since April 2017 - ending the longest bull market in history

It was the worst Christmas Eve drop and the worst December for the S&P 500 on record (technically, since The Great Depression although this is interpolated as back then there was no S&P500)

Risk aversion is now extreme; even though the Street may point to a ‘less dovish’ FOMC and concerns about a U.S. government shutdown as possible reasons for the selloff, the apparent lack of positive drivers and headlines has curbed risk appetite,” Nomura strategist Masanari Takada wrote in a note.

“While sentiment looks to be skewed towards fear, most market participants seem to be looking for a plausible excuse to sell.”

Steve Mnuchin epicly failed to calm the market over the weekend...

As Michael O’Rourke, JonesTrading’s chief market strategist, said:

"...nothing says don’t panic like saying ‘I’m calling the plunge protection team tomorrow.' I honestly think that’s the type of event that’s going to startle markets and create more panic and fear when it’s meant to create confidence."

And sure enough, the plunge protection team's best efforts utterly failed to stem the tide...

 

A bloodbath...

 

As waves of selling hit the market... (very notable for such a normally quiet day - volume was almost double the recent average)

 


S&P volume set to be almost triple that of the past 9 pre-Christmas sessions

 

 

 

Bank stocks suffered...

 

And just the mention of the word 'liquidity' sent bank credit risk soaring...

Even the supposed safe-haven stocks were pummelled... The S&P 500 utilities index drops as much as 4.6% intraday, most since August 2011, amid the broader market rout and continued threat of higher interest rates in 2019.

 

And along with stocks, the dollar was dumped wholesale...

 

And credit markets were monkeyhammered...to their widest since Brexit

 

Bonds were bid (with 30Y back below 3.00% intraday)...

 

And inflation breakevens were clubbed like a baby seal...

 

Yuan strengthened...

 

Cryptos soared since Friday, with Ethereum up 36% and Bitcoin back above $4,000...

 

Despite the dollar weakness, crude prices collapsed further as PMs rallied...

 

Gold soared (in dollars) on the day...

 

Breaking above its 200DMA...

 

And gold in yuan broke out of its channel...

 

WTI tumbled to almost a $43 handle...

 

Finally, since The Fed hiked rates and Powell didn't back down on auto-pilot, the S&P is down 8%, the dollar is down over 1%, and gold and the long bond are up around 1%...

And,@IvanOnTech provides a little context for just how bad this bloodbath is...

"This is not ICOs, this is NASDAQ % drop from ATHs. Scam? GOPRO -95% FIT -92% LC -91% SNAP -83% P -80% ZNGA -77% HIVE -73% TRUE -66% TWTR -63% SONO -60% DBX -57% Z -57% PS -50% FTCH -49% PSTG -48% SPOT -48% BOX -46% DOCU -45% SVMK -45% FB -42%"

And the odds of a rate hike in 2020 are now the same as the odds of rate-cut.