Why the big stock sell-off?

At this stage of the game, I strongly suspect that we are seeing a delayed reaction by retail mutual fund customers who saw the chaos last week and put in fund redemption requests that are working their way through the system. No mutual fund manager wants to sell into weakness since that only perpetuates a downward spiral, but when retail customers get scared and start selling en masse, the managers do not have a lot of choice.

The other obvious explanation is that short-sellers are now focusing on nonfinancial stocks.

And, since we are seeing oil and gold spike up on the same day as the marker turns and heads south, that strongly suggests that hedge funds are re-opening "long commodities, short the dollar/stocks" trades.

-- Jack Krupansky