Stocks are expected to test the lows of the year in the near future and could be setting up for the first really negative year since 2008.
Wall Street's consensus view remains that the market will close higher in 2015, expected to bounce after testing the year lows, but some strategists say the odds are growing that the market will end the year with losses. The last closed lower on the year in 2011 when it was basically flat, less than a 10th of a point lower. The last time it was negative before that was when it declined by 38 percent in 2008.
Goldman Sachs Tuesday became one of the first firms to officially forecast a negative year, cutting its year end estimate for the S&P 500 to 2000, from 2100. It cited a slower pace of activity in China and the drop in oil prices, which has slammed earnings.
Stock futures were slightly higher Tuesday, as commodities, like copper and oil, firmed. The S&P 500 Monday fell 49 points or 2.6 percent to 1,881, and the Dow was down 312 points to 16,001.
Even with Tuesday's bounce, strategists say the S&P is likely to take aim at 1,867, the low set Aug. 24, and some see it continuing to move lower in an environment of uncertainty about China, the global economy, rising interest rates and the commodities meltdown. Add to that the steep decline in market leader biotech, which took another hit Monday after congressional Democrats pushed for a hearing on Valeant's pricing practices. Valeant lost 16 percent and the IBB iShares Nasdaq Biotech ETF fell 6.3 percent Monday, giving it a 14 percent decline in the past week. The ETF was slightly higher ahead of Tuesday's open.