Inside the 10 Most Eventful SPY Sessions of All Time

by on March 17, 2014 | ETFs Mentioned:

In the ETF space, there is no fund more prolific than the SPDR S&P 500 ETF (SPY, A). Launched in 1993, SPY was the first ever exchange-traded product, and more than two decades after its debut, SPY is joined by over 1,500 ETPs that are available to investors. The fund currently has more than $158 billion in assets under management, and its shares exchange hands roughly 120 million times per day on average [see The Complete History of the SPY].

During its most active session, SPY was reported to have traded more than 870 million shares; in comparison, the fund’s daily trading volume ranged from 5,200 to roughly 40,000 during its first year of trading in 1993. In this piece, we take a closer look inside SPY’s 10 most eventful sessions of all time:

1. October 10, 2008: 871,026,300

SPY’s most active session came after a seven session losing streak; headlines dubbed the decline a “slow-motion crash” driven by deepening fears about the banking system and the spillover effects it may have on the rest of the economy. By this time, analysts had already begun calling the financial crisis a “secular bear market.”

That same session, the Dow plummeted 679 points; SPY however, managed to gain back some lost ground during the final hours of trading, closing at -0.2% on the day.

2. November 20, 2008: 814,180,400

During this session, the S&P 500 plunged to an 11.5-year low that saw the index lose 6.7%, while SPY shed 3.99%. Growing fears of a prolonged recession sparked the massive selloff. Both the Dow and the Nasdaq also closed at their lowest point since 2003. The session’s selloff accelerated during the afternoon hours after disappointing labor market and manufacturing data were released.

Also during this session, Treasury Secretary Henry Paulson was quoted, stating that the current financial crisis is something only seen once or twice in a century.

3. September 18, 2008: 776,114,700

U.S. equities rallied during this session after news reports stated that Paulson, President Bush, Bernanke, and SEC Chairman Christopher Cox met to discuss a more “permanent solution” to absorbing debt. The plan later became known as the Troubled Asset Relief Program (TARP).

Also during the session, rumors surfaced of Morgan Stanley considering a merger with Wachovia. Subsequently, the S&P index rose 4.3%, while SPY rose 2.0% [see 101 ETF Lessons Every Financial Advisor Should Learn].

4. November 13, 2008: 753,141,900


Following a three-day losing streak, equity markets surged ahead during this session, bouncing back from multi-year lows; the day prior, the S&P 500 index was sitting at a 5.5-year low.

Cautious investors believed the bear market had reached a bottom – at least in the near term. That day, however, investors had ignored a slew of lackluster economic reports, including increased unemployment claims, export declines, and rising foreclosures. SPY gained 6.3% during the session.

5. October 8, 2008: 725,414,800


Wall Street was in for a volatile session this day after the Federal Reserve announced its emergency interest cut, coordinated with central banks across the globe. Investors, however, remained understandably gloomy about the outlook for the economy.

The S&P 500 index fell 1.1%, while SPY fell nearly 3%. Also on this day, the Fed announced after the closing bell that it would be giving AIG an additional loan of $37.8 billion.

6. November 21, 2008: 718,536,500


Stocks pushed higher during the morning hours of this session on news that Citibank would put itself up for sale. The company’s CEO quickly shot down those rumors, sending equities lower.

During the final hours of trading, stocks rallied after news reports indicated that president-elect Obama would appoint New York Federal Bank President Timothy Geithner as the new Treasury secretary. SPY closed 4.32% higher.

7. August 9, 2011: 717,828,700


During this session, stocks briefly fell after the Federal Reserve announced it would keep interest rates exceptionally low until 2013. The Fed stated that the deterioration in the labor market and slower-than-expected economic growth required the central bank to take these actions.

Equities, however, rebounded after investors digested the Fed’s statement, with the S&P 500 index rising 4.7% on the day [see The Fed Effect: How Monetary Policy Impacts Your ETFs].

8. October 16, 2008: 708,811,200


U.S. equities endured a volatile session on this day; though investors were weary of a prolonged recession, many stepped in to scoop up shares battered in the recent market selloff.

During this session, the CBOE Volatility Index also rose to an all-time high of 81.7, but pulled back in the afternoon. SPY closed up 2.43% on the day.

9. August 8, 2011: 702,263,900


U.S. equities took a steep nosedive this session, logging in their worst day since the 2008 financial crisis. Stocks slid after Standard & Poor’s announced that it had downgraded the United States’ coveted AAA credit rating.

Investors also weighed the worsening European debt crisis, as well as rising fears of a new U.S. recession. On the day, the S&P 500 ETF fell 4.75%

10. August 10, 2011: 662,607,400


Rising fears about Europe’s ongoing debt crisis weighed heavily on the market during this session. After the U.S.’s credit downgrade, many feared that France would be next [see The ETF Performance Visualizer].

Additionally, U.S. bank stocks took a steep dive, even after the CEO of embattled Bank of America had attempted to reassure investors that banking conditions were much better than four years ago. During the session, SPY ended 2.49% lower.

Follow me on Twitter @DPylypczak

Disclosure: No positions at time of writing.