STOCKS, GOLD, OIL ALL TUMBLE: Here's what you need to know

On the first day of trading after the Federal Reserve put an end of seven years of crisis-era, stocks sold off dragged down a decline in the price of oil and a number of oil-related stocks.

But first, the scoreboard:

• Dow: 17,496, -252, (-1.4%)
• S&P 500: 2,041, -31, (-1.5%)
• Nasdaq: 5,002, -68, (-1.3%)

And now, the top stories on Thursday:

1. Martin Shkreli was arrested. On Thursday morning the business and finance world woke up to the stunning news that the bad boy of biotech had been scooped up by the FBI in Manhattan. Shkreli was brought in on securities fraud charges related to two hedge funds he ran a few years back, with the Justice Department calling his three-way money swap between these funds and Retrophin - the publicly-traded pharmaceutical company he ran until September 2014 - a Ponzi scheme.
2. In a statement, Retrophin said:

   "A new chapter for Retrophin began the day the company replaced Martin Shkreli more than a year ago-and that decision has been vindicated by today's indictment. Upon discovering potential misconduct by Mr. Shkreli, we authorized an independent investigation, filed a lawsuit against him, and fully cooperated with the government investigations. As the indictment says, Mr. Shkreli engaged in 'a scheme to defraud Retrophin.'

   Under its current leadership, Retrophin continues to move forward. The company has added new members to its Board of Directors and management team, implemented new financial controls, and further developed its pipeline of promising drugs for patients with rare diseases while steadily improving its operating performance."

3. But since most people are worried about the really important things in life, questions immediately began over whether language in the DoJ complaint that said the government might "seek forfeiture" of "any property, real or personal, which constitutes or is derived from proceeds traceable to any such offenses" could result in Shkreli's $2 million copy of the Wu-Tang Clan's album - "Once Upon a Time in Shaolin" - being seized. A US attorney declined to comment when asked about the issue during a press conference.
4. In what likely came as a surprise to many readers, Shkreli's arrest had nothing to do with the actions that actually made him a part of the national conversation over the last few months. In September Shkreli's company Turing Pharmaceuticals found itself in the spotlight after reports the company raised the price of one of its drugs 5,000%. We'd also note that Shkreli also concurrently serves as the CEO of publicly-traded KaloBios, shares of which fell about 50% in pre-market trading following his arrest before being eventually halted for trade. KaloBios shares did not re-open on Thursday.
5. In news that was expected, Thursday marked the first day in seven years that the Federal Reserve's benchmark interest rate traded above its crisis-era level. On Thursday the Fed Funds rate traded in a range of 0.25%-0.50%, up from 0%-0.25% on Wednesday. Following this interest rate increase from the Fed, the first reverse repo operation - which involves the Fed taking in cash reserves overnight in exchange for Treasury bonds and is the primary tool used to push the lower bound of the Fed's rate target higher - went off without a hitch.
6. There's still too much oil. On Thursday the price of West Texas Intermediate crude oil, the US benchmark price, fell nearly 2% to around $34.80 a barrel, another near seven-year low for the commodity which just cannot catch a bid. Accordingly, the Russian ruble hit a record low against the dollar. In an afternoon email Rich Barry, floor governor at the NYSE, said that traders on the floor were attributing Thursday's leg lower in stocks to the decline in oil, not the new interest rate regime ushered in by the Federal Reserve.
7. On the economic data front, the latest reading on weekly initial jobless claims came in better-than-expected, with claims totaling 271,000 last week. The four-week moving average of claims, which measures the number of people filing for unemployment benefits for the first time, fell to 270,500, right around post-crisis lows. In manufacturing news, the Philadelphia Fed's manufacturing index tumbled to -5.9 in December, indicating a contraction of activity in the region and missing expectations for a reading of 1.0.
8. We're almost done getting 2016 stock market forecasts as Wall Street looks towards the final two weeks of the year as a time to get some R&R after what has been a tough 2015. Tom Lee at Fundstrat, as one of the final strategists to put in his outlook, called for stocks to rise about 12% next year, putting a year-end 2016 price target on the S&P 500 of 2,325. The drivers of Lee's call include a belief that global growth will accelerate in 2016 while the US dollar will actually be flat or weaken next year. The dollar served as one of the major drags on corporate profitability this year.
9. There is, however, that pesky matter of valuations that might make some investors nervous going into 2016. In a note to clients on Thursday, analysts at Bespoke noted that 2016 will make the third year during this bull market that stocks entered the year overvalued. Right now, the S&P 500 trades at about 19.6 times trailing earnings, a level not seen since the financial crisis which, Bespoke notes, saw earnings in free fall. And as avid readers of our site will know, "earnings recession" is something a number of strategists have talked about this year. This has come through, and as a result brought up stock multiples which expanded as the S&P 500's price level remained flat while the underlying profitability fell out from underneath the market. Bespoke adds that, "At just under 20 times trailing earnings, there really is no way of sugar-coating the fact that the market as a whole is undervalued."
10. Even so, all strategists we've heard from expect stocks will rise next year.

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