Global markets are selling off again.
On Wednesday, the rout began in Asia, where Japan's Nikkei index closed in a bear market — defined as a 20% drop from a recent top — while Chinese stocks in Hong Kong fell to their lowest level since 2007.
US stocks started the trading session deep-red, with the Dow falling more than 400 points in morning trading.
To recap, it has been the worst start ever to a calendar year for the stock market. From the first trading day of 2016 to the open Wednesday, the S&P 500 is down 8%.

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Crude oil is also getting hit hard. West Texas Intermediate crude oil, the US benchmark, fell nearly 3% to as low as $27.32 a barrel, its lowest level since 2003. Brent crude, the international benchmark, was also down about 2%, following Tuesday's warning from the International Energy Agency that Iran's return to exporting could drown the world in oil.
And as crude oil was declining, so were energy stocks on the S&P 500. The sector was the biggest loser on the benchmark index in early trading with a 1.8% drop.
Meanwhile, investors were buying into the safety of US government debt. The yield on the benchmark 10-year Treasury note, which falls when the note's price rises, fell below 2% and to its lowest level since October.
Strategists everywhere are having to field panicked questions from clients about whether this means the US economy is headed for a recession. As we detailed over the weekend, many of the pros agree that this is not a likely scenario.
And in weekly commentary, Nuveen Investments' Bob Doll noted that non-equity financial assets that are typically under strain near a recession, like government bond yields and non-energy fixed income credit, are stable.
"It looks to us as if stocks are pricing in a 50% chance of a recession; we think the odds are actually closer to 25%," he wrote.
In a note to clients on Wednesday, Deutsche Bank's Jim Reid suggests that what we're seeing is an expected repricing of relatively pricey global assets. And for the investor whose focus is further than the intraday market swings, the present volatility is good news.
He writes,
In our annual long-term studies over the last two or three years we've bemoaned the fact that the vast majority of traditional global assets have recently been very expensive relative to their longer-term trend or fundamental fair value. So in that respect over the last few quarters we've now seen a number of these assets start to cheapen up considerably ... However, at least more opportunities for higher returns in the future are arising with recent market falls. That should be welcomed by most over the medium to longer-term.
The economic-data calendar was dominated by the consumer price index for December, which unexpectedly fell 0.1% due to falling energy costs. 

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