Wall Street slumped after week data from China escalated
Wall Street slumped more than 2 percent on Tuesday, pushing all three major indexes into the red for the year, after weak data from China escalated fears that the slowdown in the world’s second-largest economy will constrain global growth.
The sell off was broad. All 10 major S&P sectors were lower between 1.8 and 3.4 percent. All 30 Dow components were down between 1.5 and 4 percent.
Data early on Tuesday showed that China’s manufacturing sector shrank at its fastest pace in three years in August. Later in the day, data showed that the pace of growth in the U.S. manufacturing sector slowed in August to its weakest in over two years.
Adding to the nervousness, International Monetary Fund head Christine Lagarde said global economic growth was now likely to be weaker than had been expected just a few months ago.
The weak data pushed oil prices down more than 7 percent, snapping three days of gains, and also reduced the odds that the Federal Reserve would raise interest rates this month.