Volatility continues full swing with the difference between the day's low and high over 250 points, and at one point being nearly 300 points off yesterday's close but finally settling in at a more palatable 179 point loss.  Some of it was this ugly Volkswagen cheating scandal, which some pundits now fear may threaten the very survival of the auto giant.  But mostly it was just same old, same old -- continuing fears over China and today, those fears hit the copper and industrial metals markets particularly hard as an awful lot of our hard stuff goes there.  And there are always those who will argue that the real problem is continuing uncertainty over the Fed.  Just WHEN will that hike come?  Further comments today reinforced the notion that there likely will be a hike by December.  Janet Yellen will be adding more comments again on Thursday.  But the reality is that the S&P remains overvalued so there is still room to slide before we can really call it a correction.  And the CBOE Volatility index is just slightly above it's 20 year average and that is not bad news either.  The volume of 7.3 billion was a little below the 8.3 average of the last four weeks.

Markets | Tue Sep 22, 2015 5:51pm EDT

Wall Street slides with commodity-related stocks, autos

BY CAROLINE VALETKEVITCH

DJ:   16,330.47  -179.72      NAS:  4,756.72  -72.23       S&P:  1,942.74  -24.23

(Reuters)  U.S. stocks dropped on Tuesday as a selloff in commodities dragged down materials companies while Volkswagen suppliers' shares dropped following the German carmaker's emissions scandal.

S&P materials .SPLRCM, down 1.8 percent, led the decline for the S&P 500, but the selloff was broad-based, with all 10 major sectors lower. Shares of Newmont Mining (NEM.N) were down 6.3 percent at $15.59.

Lingering worries about slower growth in China pushed commodities to two-week lows, with copper prices CMCU3 and industrial metals leading losses. U.S. crude oil CLc1 also settled lower.

News that Volkswagen (VOWG_p.DE) admitted to cheating on vehicle emission tests sparked a global selloff in auto stocks.

Shares of Volkswagen suppliers BorgWarner (BWA.N) and Delphi Automotive (DLPH.N) had among the biggest drops, with BorgWarner shares down 7.6 percent at $39.37, the S&P 500's biggest daily percentage decliner, while Delphi lost 3.6 percent to $74.44. Shares of Ford (F.N) were down 2.8 percent at $13.92.

Biotech stocks fell for a second day after U.S. Democratic presidential candidate Hillary Clinton said she would propose a $250 monthly cap on prescription drugs. The Nasdaq Biotech Index .NBI was down 1.7 percent.

"It's China. It's the Fed. It's slowing global growth. The news on Volkswagen is overhanging the auto industry. There is a bit of a bubble in the healthcare area," said Tim Ghriskey, chief investment officer of Solaris Group in Bedford Hills, New York.

The Dow Jones industrial average .DJI fell 179.72 points, or 1.09 percent, to 16,330.47, theS&P 500 .SPX lost 24.23 points, or 1.23 percent, to 1,942.74 and the Nasdaq Composite.IXIC dropped 72.23 points, or 1.5 percent, to 4,756.72.

The Fed's decision last week to keep benchmark interest rates near zero has left investors guessing when the U.S. central bank will make its big move.

Atlanta Fed President Dennis Lockhart said on Monday a rate hike later this year was still possible. Lockhart is scheduled to speak again later on Tuesday. Fed Chair Janet Yellen speaks on Thursday.

Uncertainty about the Fed's rate outlook as well as the lingering concerns over China have kept investors on edge for weeks. The S&P 500 is now down 5.6 percent for the year so far.

The CBOE Volatility index .VIX, Wall Street's fear gauge, jumped 11.4 percent to 22.44, above its long-term average of 20.

Among the day's other big decliners in the materials area, Mosaic (MOS.N) slumped 7.0 percent to $33.88 after the fertilizer maker cut its quarterly sales forecast.

Goldman Sachs (GS.N) fell 2 percent to $179.72 and was the biggest drag on the Dow after Chief Executive Lloyd Blankfein said he had a "highly curable" form of lymphoma.

Declining issues outnumbered advancing ones on the NYSE by 2,442 to 623, for a 3.92-to-1 ratio on the downside; on the Nasdaq, 2,171 issues fell and 636 advanced for a 3.41-to-1 ratio favoring decliners.

The S&P 500 posted one new 52-week high and 35 lows; the Nasdaq recorded 16 new highs and 118 lows.

About 7.3 billion shares changed hands on U.S. exchanges, below the roughly 8.3 billion daily average for the past 20 trading days, according to Thomson Reuters data.