Markets fall as Santa rally looking elusive

Markets were mostly lower on Monday.

The S&P 500 plunged 2.1 percent while the STOXX Europe 600 fell 1.1 percent.

Earlier, however, the Nikkei 225 rose 0.6 percent.

“The ‘Santa rally’ which had been hoped for has proven to be frustratingly elusive, and now markets are quite happy, if not desperate, for at least a dovish line to be thrown by the FOMC,” said Vishnu Varathan of Mizuho Bank.

“Anybody hoping for a Santa Claus Rally this year will be disappointed,” said Randy Frederick, managing director of active trading and derivatives at Charles Schwab.

“People have been buying the dips, but it’s just not working, and at a certain point that will lead to a buyer’s strike,” said Alec Young, managing director of global markets research at FTSE Russell.

Indeed, William Watts at MarketWatch noted that there has been no sign of panic selling to suggest a market bottom while Tomi Kilgore also of MarketWatch suggested that the S&P 500's recent pattern of lower recovery highs indicates that the primary trend is now down.