I'll take the position that this is the first leg down in a new bear trend. For the last quarter or two, upside leadership has been narrowing and falling on the shoulders of a relatively few big cap issues like AAPL and the familiar blue chip names.
All the while that the DOW was flashing 18,000, the foundation was crumbling until the last two weeks when it started its inevitable collapse.
The China situation simply adds another dimension to the anemic performance here in the USA. A majority of Chinese stocks are still wildly overvalued. I could see another 40% or more down in the coming months. This does not bode well for stocks like CAT and certain mining issues and metal commodity plays.
Until the U.S. market's new lows start to show moderation, this market trades lower. It is not a coincidence that fundamentals are increasingly confirming the contraction in individual stock valuations. Dividend plays will not save you either.