Dow Falls 500 Points As Global Selloff Intensifies

Wall Street's worst-ever start to a year isn't getting any better.

On Wednesday, benchmark indexes opened steeply lower, echoing a global rout that came as oil continued to cave, dropping to a 12-year low.

"Negativity is driving the markets in 2016," said Nick Raich, CEO at the Earnings Scout. "Some of the selloff has been justified, stock prices are resetting to reflect lower growth expectations."

Falling to its lowest level since late 2014, the Dow Jones Industrial Average (DJIA) was off 534 points, or 3.3 percent, at 15,482 as of 12:23 p.m. ET. The S&P 500 (SPX) declined 66 points, or 3.5 percent, to 1,816. The Nasdaq Composite (COMP) shed 155 points, or 3.5 percent, to 4,322.

Energy weighed the most among the S&P 500's 10 major sectors, all of which were in the red.

"Data justify a correction, not necessarily a bear market," said Raich of economic reports, which on Wednesday had the cost of living in the U.S. falling in the final month of 2015.

A separate report illustrated an unexpected December decline in new-home construction.

IBM (IBM) shares lost ground, falling 4.2 percent to $122.70 a share, after the technology giant's 2016 earnings outlook came in below projections.

On the New York Mercantile Exchange, crude futures dropped more than 5 percent to $26.92 a barrel, and were lately $1.48, or 5.2 percent, to $26.98 a barrel.