It was another big day for the markets, even bigger than yesterday as a combo of continuing falling oil prices (crude lost more than 2.5% this week), continuing concerns about China, and a 2nd day of massive options expiring drove the Dow down in one of the biggest routs in recent memory -- a massive 367 points.  But all is not as it appears.  Despite all the "expert" hindsight, and despite Wednesday's elation over the Fed's rate hike announcement, the fact is you don't have to be Bernard Baruch to understand that the rate hike was bound to trigger a correction of some sort until investors in the U.S. and around the world become satisfied that the hike will have its intended consequence of stabilizing the markets and the overall economy.  But it will likely be months before we really know if the world will adapt to this new environment.  Since the answer will very likely be yes, let's hope stability comes sooner rather than later.  Meanwhile, global sentiment will remain one of raw nerve as demonstrated today with the way above-average volume of nearly 12 billion shares that brought the market down more than two percent in one-day alone.

 Markets | Fri Dec 18, 2015 7:00pm EST

Wall St. slides on lower crude prices, stock options expiry

BY MARCUS E. HOWARD

DJ:  17,128.55  -367.29      NAS: 4,923.08  -79.47         S&P:  2,005.55  -36.34

REUTERS/LUCAS JACKSON

U.S. stocks closed lower on Friday for the second straight day, as concerns, ranging from a decline in crude oil prices to the global response to the Federal Reserve's interest hike, weighed down the market.  The expiration of stock and index options contracts added volatility in a heavy trading volume day.

The S&P and Dow had their worst two-day performance since Sept. 1, while indexes posted losses for the week.

"It's a confluence of all the factors: oil prices continuing to run down, the Chinese trying to counteract the dollar and everyone is digesting, globally, what the Fed's announcement means for emerging markets and everything else," said J.J. Feldman, portfolio manager at Miracle Mile Advisors in Los Angeles.

The week was dominated by the Fed, which raised rates on Wednesday for the first time in nearly a decade.

Financial stocks .SPSY, which fell 2.5 percent, was the worst-performing S&P sector on Friday. The biggest drag on the financial index, Berkshire Hathaway BRkb.N, was down 3.3 percent.

Bank of America (BAC.N) was down 3.1 percent, while Wells Fargo (WFC.N) was down 3 percent and JPMorgan (JPM.N) was off 2.8 percent.

The Dow Jones industrial average .DJI closed down 367.25 points, or 2.1 percent, to 17,128.55, the S&P 500 .SPX had lost 36.34 points, or 1.78 percent, to 2,005.55 and the Nasdaq Composite .IXIC had dropped 79.47 points, or 1.59 percent, to 4,923.08.

For the week, the Dow fell 0.8 percent, the S&P 500 fell 0.3 percent and the Nasdaq lost 0.2 percent.

Wall Street also remained anxious over an oil glut amid a demand slowdown. U.S. crude CLc1 futures settled the day down 22 cents, or 0.6 percent, at $34.73 a barrel. For the week, oil lost 2.5 percent.

Volatility was slightly higher than usual on account of "quadruple witching" - the expiry of options on stocks and indexes as well as futures on indexes and single stocks.

While higher volume and a pick-up in volatility are not unusual on options expiration day, Randy Frederick, managing director of trading and derivatives for Charles Schwab in Austin, Texas, said Friday's sell-off appeared to be tied more to the Fed’s move and lower oil prices.

Declining issues outnumbered advancing ones on the NYSE by 2,013 to 1,074, for a 1.87-to-1 ratio on the downside; on the Nasdaq, 1,813 issues fell and 1,084 advanced for a 1.67-to-1 ratio favoring decliners.

The S&P 500 posted one new 52-week high and 37 new lows; the Nasdaq recorded 36 new highs and 136 new lows.

Volume on the U.S. exchanges was 11.85 billion shares, compared to 7.24 billion average for the full session over the last 20 trading days, according to Thomson Reuters data.