As I understand it, the high yield market segment that is in trouble is essentially the junk bonds.  So far it seems isolated to the energy sector as well as companies in trouble. In my opinion, the outlook for the market is dependent on whether it remains contained to these companies or if it spreads to the mid-tier companies.  That said, the chances for another 10% to 15% pull back over the course of 2016 is IMO greater than 50%, probably higher.

Re the economy, I would be cautiously optimistic that it can remain on track for the next 12 months. I think the odds increase greatly after that if companies continue to keep a lid on CapEx, and if a profit recession continues to pressure them.

I have also read that China may be bottoming out, the analyst/economist (?) was saying that his firm does not only rely on published Chinese government data as it is not trustworthy, but complement it with a variety of other economic research/surveys to divine how to read it.  Either way, I take it with a large grain of salt as with either case, it is subject to potentially large errors.  That said, if and when China actually bottoms and begins to grow its consumer sector, I think pressures across the globe will ease.  China has become a large factor on where the world's economies go.

I would like to hear other opinions regarding these subjects.