Jan 7, 2016 5:18 PM by NBC News
Uncertainty about how quickly China's economy is weakening continued to hammer U.S. stock markets on Thursday, sending the Dow Jones industrial average down 392 points - or 2.3 percent of its total value -- for its biggest loss in three months.
Reuters reported that the Dow's 5.2 percent decline in the first four trading days was its worst performance to begin a year since the 30-stock index's creation in 1928.
The Standard & Poor's 500 index and the Nasdaq composite also were creamed, with the former losing 47 points, or 2.4 percent, and the latter sliding 146 points, or 3 percent.
The Dow and Nasdaq ended the day more than 10 percent below their 52-week intraday highs, officially entering what economists consider a market "correction." The S&P 500 was just short of the threshold, about 9 percent away from its 52-week high.
Thursday's battering of the markets followed a similar pounding on Wednesday and was the third negative trading session out of four in the new year. Technology stocks have been some of the hardest hit. The tech-heavy Nasdaq composite has plunged 8 percent since Dec. 29.
Markets around the world were spooked by a steep drop in Chinese stocks. The superpower had to halt trading earlier Thursday when losses plummeted 7 percent. The 29-minute session was the shortest trading day ever in the CSI 300 Index's 25-year history.
The China Securities Regulatory Commission later suspended its so-called circuit breaker system, which suspends trading for 15 minutes in the event of a 5 percent selloff and halts it for the day if it reaches 7 percent, as happened Thursday. The move appeared to be an acknowledgement that the newly rolled out system was exacerbating panic selling.
The selloff in China was sparked by reports that indicate slower growth for the world's second-largest economy and by Beijing allowing the country's currency, the yuan, to take its biggest fall in five months to reach its lowest level against the dollar since March 2011.
After registering big declines in early trading in reaction to the Chinese trading halt and steep declines in European markets, U.S. markets stabilized in early afternoon only to be hammered by a Reuters report citing sources as saying that China's central bank is under increasing pressure from policy advisers to let the yuan currency fall quickly and sharply, by as much as 10-15 percent.
With Beijing accelerating the yuan's depreciation to make its exports more competitive, investors fear China's economy is even weaker than had been imagined.