The equities market was moving in sideways trading through mid-August on a mix of stronger U.S. economic data and volatility overseas, notably in China.
However, the FOMC meeting in mid-August hinted that the economic data points may not have been strong enough to warrant a Fed policy shift, which triggered a market sell-off.
The initial fall triggered additional panic selling as investors pointed to weakness in both China and emerging markets where currency devaluations were dragging on the economies. The selling snowballed and dragged down benchmark indices below their long-term trends and into correction territory.
Toward the end of the month, bargain hunters entered the market to pick up where sellers left off, fueling a small bounce in equities. Nevertheless, the stock market still experienced volatility and large intra-day swings.
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Max Chen contributed to this article.