The local sharemarket has extended its slide today, losing another 1.2% after yesterday's 0.9% decline. The falls come on the back of the impressive 4.5% increase last week, which marked the S&P/ASX 200's (Index: ^AXJO) (ASX: XJO) strongest week in four years.
While it was the miners that performed particularly strongly during last week's rally, they're also the ones leading the rout today following the release of disappointing trade numbers from China, revealing an eleventh straight month of declining imports.
At the same time, oil prices fell 5% overnight which is also acting as a drag on the energy sector.
Indeed, the sharp fall has spread caution throughout the industry, highlighting that investors shouldn't get too comfortable in assuming the commodities rout has found a floor.
Fortescue Metals Group Limited (ASX: FMG) was one of the hardest hit, falling 7.9%, while Rio Tinto Limited (ASX: RIO) and BHP Billiton Limited (ASX: BHP) also fell 2.1% and 2.4%. Meanwhile, Santos Ltd (ASX: STO), Origin Energy Ltd (ASX: ORG) and Liquefied Natural Gas Ltd (ASX: LNG) were down 6.25%, 7.7% and 10.1%, respectively.
Most of the banks also fell in what was a broad selloff. Commonwealth Bank of Australia (ASX: CBA) and Westpac Banking Corp (ASX: WBC) were the hardest hit, falling 1.6% and 1%, while Australia and New Zealand Banking Group (ASX: ANZ) managed to gain 0.3%.
What should you do?
In my opinion, now could be a great time for long-term investors to begin buying shares in high-quality companies trading at reasonable prices. If history is anything to go by, these dips in the market are when the world's most successful investors really make their money.
In saying that however, it is also vital that investors remain prepared for further volatility, and ensure they have their emotions in check so as to not be tempted to sell into the panic if times get tough again.