China's stock market correction has spread from financials and real estate to the rest of the market.

For almost two months now, China's banking regulators have stuck to their message: China's big banks may need to raise more capital and put aside more money for reserves. (See my post from Nov. 24.)

In response, China's banks have throttled back a bit on lending -- which has hurt real estate developers and speculators -- and moved more loans off balance sheet by packaging them and selling them to trust companies. (See my post from Dec. 18.)

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The regulatory campaign has created a correction in bank and real estate stocks.The iShares FTSE/Xinhua China 25 Index ETF (FXI), which has a heavy exposure to China's banking and real estate big boys, peaked at $46.35 on Nov. 16 and then fell to $43.11 by Nov. 27. That's a 7% decline.

During that time, though, the rest of the Chinese market moved along just fine. CTRIP.com International (CTRP), an Internet travel company that I use as an indicator for the direction of China's nonfinancial, non-real estate stocks, saw its shares move up from $72.19 on Nov. 13 to $77.21 on Dec. 2.

In December, though, bank and real estate stocks have kept falling -- FXI fell another 4% from Nov. 27 to Tuesday for a total drop of 11% since Nov. 16. But CTRP has now joined in the rout: Shares have fallen 9% from Dec. 2 to this morning.

CTRP is a stock that I've suggested readers watch for as a possible buy on any dip. (For my logic on CTRP and some other China stocks to watch, see this post from Nov. 17.)

It's hard to tell how low this dip will go, but on recent history, the stock has been a buy when it drops to its 50-day moving average. That suggests that $65 or so would be a good entry. The stock is at $68.57 as I write this.

At the time of this writing, Jim Jubak owned shares of CTRP in his personal portfolio, and was looking to add to that position.