Analysts say there is no single cause for the plunge, but concerns about the possibility of the Fed raising rates on the back of a more positive jobs market and poor projected earnings reports from several U.S. companies are looked to as potential drivers behind the sell off.
Other possible spurs for investor unease are the recent news that Argentina is expected to default for the second time in 13 years on bonds and concerns over the European Central Bank needing to offer more stimulus.
Joe Spinelli of Deutsche Bank said, "There are so many things coming to a head simultaneously, clients are wanting to get into a position to ride out any storm that might pop up."
Trading volume was higher than normal but was not at levels that would indicate a panic. Trading desks are seeing strong movement into more Exchange Traded Funds and commodities as investors seek to hedge their investments amid the current volatility.
Stuart Lippman, a fund manager at TIG Advisors LLC in New York told the Wall Street Journal this week, "There's one thing for sure: History repeats itself, and this is starting to feel like a bubble"
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