What's going on?

It started with another abysmal day for Chinese stocks (-7.5%), but the Chinese central bank then said it would step in to stimulate the economy. Stocks in Europe rebounded 5% and things were looking good in the US until selling resumed late in the day and US stocks finished almost 1.5% lower.

What does this mean?

The price action in the US is concerning; it�s the sort of volatility that reminds many of the 2008 financial crisis. When fear permeates the market, it is difficult for prices to find a floor. Also, when US stocks close at the lows of the day, like they did, it can suggest that there is more selling to come. Investors become very wary of buying in these circumstances, but it can also create great opportunities for those that do.

Why should I care?

1. Due to the market turmoil, analysts now think it�s less likely that the US Fed will raise rates in September. If the Fed does not raise rates, then it could be a positive for stocks, especially in the US and emerging markets.
2. Stock markets are well off their recent peaks - down more than 10% in the US and much worse in Europe and Asia. For investors that had a balanced portfolio coming into this mess, redeploying capital into beaten down stock markets might make sense.