Another major bloodbath today, this time the fourth in the last five trading days making this officially the worst opening four days of a new year since the Dow was founded in 1928.  The Dow lost a remarkable 392 points.  Of course, there are numbers and there are numbers.  If you look at the last five days on a point basis, it's pretty bad; but on a percentage basis, not so bad.  The indexes have lost about 5% this week, not as bad as August, not as bad as July 2011, and not even in the same ball park as '08.  Hey as long as we're still flirting with 17,000 and these historic highs, no need to go overboard with the worries.  So what didn't go wrong today?

In the last two weeks, oil has gone from a 7 year low to an 11 year low to today a 12 year low.  China's stock market fell through the floor again necessitating yet another automatic shutdown of trading, the second time this week.  And the yuan had its biggest decline in five months.  So the big question is whether all the problems in China are going to impact the U.S. economy.  Tomorrow's government jobs report should give some clues on this.  Until then, investor are playing it safe and selling.  If tomorrow's data is strong, that will be taken that the U.S. economy is somewhat insulated from all the international turmoil and that should calm some of these fears.  Meanwhile, today the VIX went up another 21% to just under 25, all of which was attested to by the very frantic volume of 9.9 billion shares, way above the 7.2 billion of the past month.  Tomorrow there will almost certainly be another drama.

Markets | Thu Jan 7, 2016 7:08pm EST

Dow, S&P off to worst four-day Jan start ever as China fears grow

BY CAROLINE VALETKEVITCH

DJ:  16,514.10  -392.41       NAS:  4,689.43  -146.34        S&P:  1,943.09  -47.17

(Reuters)  U.S. stocks sold off further on Thursday, giving the Dow and S&P 500 their worst four-day starts to a year ever, dragged down by another drop in Chinese equities and oil prices at 12-year lows.  China allowed the biggest fall in its yuan currency CNY=CFXS CNY= in five months, adding to investor fears about the health of its economy, while Shanghai stocks .SSEC were halted for the second time this week after another steep selloff.

Oil prices CLc1 LCOc1 fell to 12-year lows and copper prices CMCU3 touched their lowest since 2009, weighing on energy and materials shares. Shares of Freeport McMoran (FCX.N) dropped 9.1 percent to $5.61. All 10 S&P 500 sectors ended in the red, though, and the Nasdaq Biotech index .NBI fell 4.1 percent.

"People see the weakness in China and in the overall equity market and think there's going to be an impact on corporations here in the United States," said Robert Pavlik, chief market strategist at Boston Private Wealth in New York.

"When you have a market that begins a year with weakness, people are sort of suspect anyway. The economy isn't moving all that well, the outlook is modest at best, and they don't want to wait for the long term. China creates more uncertainty."

The Dow Jones industrial average .DJI closed down 392.41 points, or 2.32 percent, to 16,514.1, the S&P 500 .SPX had lost 47.17 points, or 2.37 percent, to 1,943.09 and the Nasdaq Composite .IXIC had dropped 146.34 points, or 3.03 percent, to 4,689.43.

The Dow has lost 5.2 percent since the end of 2015 in the worst first four trading days since the 30-stock index was created in 1928. The S&P 500 is down 4.9 percent since Dec. 31, its worst four-day opening in its history, according to S&P Dow Jones Indices, while the Nasdaq is down 6.4 percent.

Stocks extended declines late in the session, and the CBOE Volatility Index .VIX, the market's favored gauge of Wall Street anxiety, ended up 21.4 percent at 24.99, its highest since Sept. 29.

Investors also braced for Friday's U.S. government jobs report, which could show how well-insulated the U.S. economy is from international stresses.

Billionaire investor George Soros, speaking at an economic forum in Sri Lanka, drew similarities between the present environment and the financial crash of 2008. He said global markets were facing a crisis and investors needed to be very cautious, Bloomberg reported.

Apple (AAPL.O), which generates a lot of its business in China and is still the most valuable U.S. company, fell 4.2 percent to $96.45, its lowest since the August market swoon.

Yahoo (YHOO.O) fell 6.2 percent to $30.16 after Business Insider reported the company was working on a plan to cut its workforce by at least 10 percent. Alibaba (BABA.N), in which Yahoo has a stake, was down 6 percent at $72.72.

Volume has been heavy this week. About 9.9 billion shares changed hands on U.S. exchanges Thursday, well above the 7.2 billion daily average for the past 20 trading days, according to Thomson Reuters data.

Declining issues outnumbered advancing ones on the NYSE by 2,704 to 415, for a 6.52-to-1 ratio on the downside; on the Nasdaq, 2,492 issues fell and 390 advanced for a 6.39-to-1 ratio favoring decliners.

The S&P 500 posted one new 52-week high and 82 new lows; the Nasdaq recorded 16 new highs and 302 new lows.