One Year Ago, U.S. Stocks Tanked on China's Shocking Renminbi Devaluation

While stocks are currently flirting with record highs, it was a much different story one year ago. On August 11, 2015, the S&P 500 opened sharply lower, as investors woke up to news that China devalued its renminbi currency by two percent against the dollar, sparking its largest one day drop in 11 years. This sent stocks into a downslide, including Apple (AAPL) - Get Report and Caterpillar (CAT) - Get Report , companies exposed to China's economy. 'The People's Bank of China decided to implement a one-off devaluation of the renminbi in order to regain some of its control of monetary policy in an environment where the Federal Reserve was getting ready to hike rates [in September 2015], or at least so we thought,' said Ian Gordon, an FX strategist with Bank of America Merrill Lynch, based in New York. The Fed ended up making its first rate hike since 2006 in December 2015, as volatile stock markets kept the Fed on the sidelines in September 2015. One year later, the renminbi has stabilized, although it still declined 4.7 percent against the dollar. A repeat of the events that took place one year ago are unlikely. 'I think the Chinese authorities have started to do a better job communicating their intentions and the expectations on what the currency is going to be doing so that has helped stabilize investor sentiment,' Gordon said. TheStreet's Scott Gamm reports from Wall Street.