Market's bloodbath continues

Fears continue to emerge regarding the pending tapering of the Fed's stimulus program.

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Despite having shown signs of making a slight recovery in early morning trading, the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) has continued its plunge today, taking a 1.5% hit after falling as low as 5028.2 points.

The benchmark index followed other equity markets around the world that fell due to fears that the US Federal Reserve could start tapering its stimulus program. Overnight, the Dow Jones fell 130 points or 0.8% following a bipartisan budget deal from Congress, which raised expectations that the Fed could begin to scale back its stimulus measures as of its forthcoming policy meeting, which is set to end December 18. This was made even more likely after another strong labour report was posted last week.

The losses on the ASX 200 were widespread but it was the banks and miners that weighed the index down the most. Commonwealth Bank (ASX: CBA) was hit the hardest out of the big four, falling by $1.80 per share or 2.4%. ANZ (ASX: ANZ) also fell 1.8% whilst Westpac (ASX: WBC) and NAB (ASX: NAB) dropped 1.6% and 0.9% respectively.

After having fallen 1.7% yesterday, BHP Billiton (ASX: BHP) continued its dive, losing another 2.1% today, which took its shares down to $35.43. Shareholders in Rio Tinto (ASX: RIO) and Fortescue Metals Group (ASX: FMG) were also hit hard with their stocks losing 1.7% and 4.4%. Fortescue's shares have now lost 9.6% of their value since mid-November, which could present as an opportunity for investors.

Blue chip companies in other sectors also failed to avoid the market's wrath. Telecommunications giant Telstra (ASX: TLS) fell by 0.9%, Woodside Petroleum (ASX: WPL) dropped 1% and Westfield Group (ASX: WDC) fell 2.2% to below the $10 per share mark for the first time since September 2012. QBE Insurance Group (ASX: QBE) also continued its plunge, sinking as low as $10.30 before recovering slightly to $10.50, making its loss for the day 4.6%.

Foolish takeaway

Whilst the markets will be affected by the pending tapering of the Fed's stimulus program in the short-term, the economy is showing gradual signs of a recovery, indicating good long-term growth prospects. As such, investors should see this as an opportunity to take advantage of quality companies trading at discounted prices.

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Motley Fool contributor Ryan Newman does not own shares in any of the companies mentioned.

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