Across globe, stocks decline

Associated Press

NEW YORK

Shaky economies and plunging currencies in the developing world fueled a global sell-off in stocks Monday as fearful investors pushed prices lower across Asia and Europe, but many of the drops were not as steep as last week.

In the U.S. and other rich countries with healthier economies, investors also retreated, although the selling was more modest.

Major indexes in both Hong Kong and Tokyo fell more than 2 percent. The selling then spread to Europe and the U.S., as stocks slipped across the board, but the declines were much less than on Friday, when the U.S. market ended its worst week since 2012.

Jack Ablin, chief investment officer at BMO Private Bank, said he was encouraged that the U.S. losses were limited.

“We have an accelerating economy, low inflation and accommodative monetary policy,” he said. “The world isn’t falling apart.”

The market turbulence was set off last week by a report from China on a downturn in its manufacturing, more evidence that the world’s second-largest economy is slowing. That’s a big problem for Brazil, South Africa and other developing countries that have come to depend on exports to that country.

Adding to the troubles: The decision by the U.S. Federal Reserve last month to scale back its bond-buying stimulus for the American economy, which has helped keep interest rates low.

Despite Monday’s widespread selling, experts say the troubles in China and elsewhere in the developing world are unlikely to derail a global economic recovery that appears to be gaining momentum. Growth in the world’s wealthy economies is expected to pick up the slack.