U.S. stocks resumed their downward trajectory after Friday's selloff, while European and Asian equities also slumped. Treasury yields fell and the dollar stabilized. Oil dropped and copper rose.
The S&P 500 Index and Dow Jones Industrial Average hit session lows Monday afternoon, with the Dow falling more than 400 points and all sectors of the broader gauge declining. The Stoxx Europe 600 Index retreated for a sixth day, its longest losing streak since November, following similar moves across Asia as both regions took their cue from the U.S. rout on Friday.
Yields on core government bonds in Europe fell, as did those of 10-year Treasuries. The pound slumped, and the euro declined.
The downward stock market move was sparked by U.S. wage data on Friday that pointed to quickening inflation, which would lead to higher rates and, in turn, rising borrowing costs for companies. Equity investors are looking for confirmation that recent declines represent the healthy correction many had expected after the stellar start to the year.
"The good news is bad news," said Donald Selkin, New York-based chief market strategist at Newbridge Securities Corp., which manages $2 billion. "Last month the market went up by 6 percent -- that's unsustainable."
Elsewhere, oil extended declines after U.S. explorers raised the number of rigs drilling for crude to the most since August. Copper climbed the most in a week. Bitcoin slid below $7,000.
Here are some key events scheduled for this week:
- Monetary policy decisions are due in Australia, Russia, India, Brazil, Poland, Romania, the U.K., New Zealand, Serbia, Peru and the Philippines.
- Earnings season continues with reports from Bristol-Myers Squibb, Ryanair, Toyota Motor Corp., BNP Paribas, BP, General Motors, Walt Disney, SoftBank, Sanofi, Philip Morris, Total, Tesla, Rio Tinto, L'Oreal and Twitter.
- Dallas Fed President Robert Kaplan and New York Fed President William Dudley are among policy officials due to speak in Frankfurt and New York.
These are the main moves in markets:
- The S&P 500 fell 1.6 percent as of 1:39 p.m. New York time, to its lowest in more than a month.
- The Stoxx Europe 600 Index declined 1.6 percent , hitting the lowest in almost 12 weeks with its sixth consecutive decline.
- Germany's DAX Index fell 0.8 percent.
- The U.K.'s FTSE 100 Index sank 1.5 percent to a two-month low.
- The Bloomberg Dollar Spot Index gained 0.2 percent.
- The euro decreased 0.4 percent to $1.2418.
- The British pound declined 0.7 percent to $1.4015, the weakest in almost two weeks.
- The Japanese yen gained 0.3 percent to 109.79 per dollar.
- The yield on 10-year Treasuries fell two basis points to 2.82 percent.
- Germany's 10-year yield declined three basis points to 0.74 percent, the largest decrease in almost six weeks.
- Britain's 10-year yield declined two basis points to 1.558 percent.
- West Texas Intermediate crude dipped 2.6 percent to $63.74 a barrel.
- Gold advanced 0.1 percent to $1,335.21 an ounce.
- Copper gained 1.8 percent to $7,169 per metric ton.