Market Insider

Embrace the selloff

Traders on the floor of the New York Stock Exchange
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After weeks of marching higher, a bout of stock market selling at the start of what is normally a robust month for stocks has some investors on edge.

Traders are questioning the lack of buying at the start of the month, which is usually a time when new money floods the market, driving stocks higher. The last time a month started off negatively for the Dow and was May, a positive month for the market but the beginning of a rout that ended in June. May was also a month that saw interest rates lift off the year's lows on talk that the Fed could slow down its quantitative easing program.

But December has something going for it that June does not have. The strong seasonality associated with the year-end has many strategists believing in a Santa rally, with visions of big investors swooping in at the last minute to put the finishing touch on year-end returns.

(Read more: Isn't it time for a down week?)