The seemingly widespread issues with nuclear plants in Japan are certainly not something one typically has to deal with in the market. Generally you expect media to overplay things so after the quake Friday, it has been a surprise to see the nuclear situation getting seemingly progressively worse as each day passes, so we definitely have this affecting sentiment. Japan fell over 6% overnight, and U.S. markets are at fresh lows as this mini 'black swan' overwhelms the normal Monday morning garbage.
I said Friday it would actually be in the bears' interest for a rally to work off some of the oversold condition, and then we (in a normal market) we'd see another leg back down. Certainly due to the news we did not get more than a 1 day bounce - but this is how selloffs usually occur. While still prone to news which can herk and jerk us around, this market definitely now seems to be in correction mode with the S&P 500 quickly fading back the 50 day. One could make bets against the index with the 50 day as your ceiling.
Usually a real correction begins with everyone thankful there is a buying opportunity but end when people feel actual consternation. Right now most everyone is just thankful they have a chance to get in, hence I'd think more downside ahead from a sentiment standpoint.