Hopes for a recovery in the United States stock market were dashed on Wednesday as investors’ deepening fears about the strength of the world’s largest economies drove another wave of selling.
The 2.5 percent slide in the market’s main benchmark, the Standard & Poor’s 500-stock index, was the worst so far this year, and came after two days of slight gains that had suggested some confidence was returning after a rocky start to the year. The index is now in what Wall Street calls a correction: a decline of 10 percent or more from its most recent high.
The market decline indicates that investors still see plenty of risks lurking, many of them stemming from China’s slowing economy. The persistent weakness in the price of oil is another market indicator that has raised questions about global growth.
The United States economy has been showing some signs of steady growth. But investors are concerned that problems in China’s economy, and the stress that creates for other countries, could unleash forces that ultimately weigh on the United States.
“When you change perceptions for the growth rate of the third-largest economic region in the world,” said Jim Vogel, interest rates strategist at FTN Financial, “you have to reprice across all financial markets to account for that slowing growth.”
The last time stocks slid into a correction was in August, when a small but surprising devaluation of China’s currency rattled investors.
Stocks rallied after the summer rout, as a recovery in Europe appeared to take hold and the Chinese currency steadied. As the year closed, most Wall Street analysts released mildly optimistic forecasts for the stock market in 2016.
But it didn’t take long for the fear to return.
One of the headwinds that investors now face is higher interest rates in the United States. The Federal Reserve in December raised interest rates for the first time in nearly a decade. Higher rates can tighten financial conditions in markets and push the dollar up against other currencies, which can in turn make it harder for United States companies to compete.
Some economists, fearing that the markets are giving an early signal of a slowdown, may now call on the Fed to hold off on any further interest rate increases.
And China is again unsettling investors. Figures show that capital is continuing to rush out of the country, a phenomenon that can add downward pressure to its currency, the renminbi.
One of the ways that China’s slowing can hurt the United State is through energy prices. As China has less demand for commodities, their prices have fallen. Oil-producing countries have continued to oversupply the markets with cheap crude.
On Wednesday, oil prices remained weak. Brent crude, an international benchmark, briefly fell through the psychologically important $30-a-barrel barrier on Wednesday, before settling down 2.4 percent for the day, at $30.12. West Texas Intermediate crude oil for February delivery settled 4 cents higher, at $30.48 a barrel. Some analysts are now raising the possibility of $20 oil.
Lower oil prices lead to cheaper gasoline prices, which can prompt consumers to increase their spending on other goods and services, usually a fillip for the wider economy. But lower energy prices are hurting the United States companies that produce oil and gas.
Energy stocks generally performed poorly on Wednesday. The Williams Companies tumbled 17.7 percent, while ConocoPhillips closed down more than 3 percent.
Some of the fiercest selling took place in technology stocks that did extremely well in 2015. Netflix, for instance, plummeted 8.6 percent on Wednesday. Amazon declined 5.8 percent. The technology-heavy Nasdaq composite index ended down 3.4 percent.
Stocks of consumer companies whose products or services are considered nonessential were among the hardest hit on Wednesday. Shares of the hotel chain Marriott closed down 6.3 percent, while Royal Caribbean Cruises ended down 5.3 percent.
The market decline has been broad and even some of Wall Street’s most successful and sophisticated investors have not been spared the downturn. William A. Ackman’s Pershing Square Holdings, for example, has already lost 11.4 percent through Jan. 12
In this fraught environment, investors are looking for any early clues on how the global economy is performing. They are now scouring the fourth-quarter earnings of large companies, which are starting to come out.
The results of the CSX Corporation, a large railroad company, which reported on Wednesday, provided little reason for optimism. The company’s chief executive, Michael J. Ward, was downbeat in a public conference call and his comments ricocheted around the market. Mr. Ward said CSX was facing pressures that were creating recessionlike conditions for the company’s freight business.
“The low gas prices, the low commodity prices, the strength of the dollar — all three of those together are really pushing,” he said.
Investors will most likely listen carefully to the earnings calls of the large banks, JPMorgan Chase, Citigroup and Wells Fargo included, that will report results on Thursday and Friday.
Since the financial crisis of 2008, the major banks have built up buffers that help them withstand turbulent markets. But their earnings are always vulnerable if consumers and companies demand fewer loans and struggle to pay back existing ones. Senior bank executives most likely will be called upon to give their impressions of financial conditions.
If the stock market continues to fall and deplete households’ savings, consumers may then pull back on their spending, which can weigh on the economy. Already this year, the value of the companies in the S.&P. 500 has fallen by $1.3 trillion, according to S&P Dow Jones Indices.
Still, the selling may pass. Many Wall Street analysts say there are reasons a bear market — a decline of more than 20 percent from a high — will not occur. Stocks, they say, aren’t wildly overvalued. Jobs growth in the United States is starting to create competition for hiring, which could push up wages, giving consumers more money to spend. Europe appears to have stabilized.
But few analysts are expecting a big bounce in the stock market. Investors may now have to get used to lower returns from stocks, after several years of strong gains.
“We believe this year is going to look very much like 2001, 2002,” said Mark Yusko, the chief investment officer at Morgan Creek Capital Management. “People forget the markets basically went down for 30 months and the economy slowed and eventually went into a mini-recession.”
Because of an editing error, an earlier version of this article misstated the decline in the Dow. It closed down 9.9 percent on Wednesday from its most recent high, not 10 percent or more, which would have put it in correction territory.