NEW YORK — The worst drop in China’s stock market in eight years helped drag down other markets Monday.
The tough day follows declines in U.S. markets last week, when the three major indexes fell more than 2 percent as big companies reported disappointing earnings.
Faced with a drop in stock prices in Asia, Europe and the U.S., investors moved into traditional safe havens. The yield on the 10-year U.S. Treasury note fell to 2.22 percent from 2.26 percent Friday. The price of gold rose 1 percent.
Dividend-heavy stocks, such as utilities, also gained. Investors favor high-dividend companies during times of volatility because they provide reliable income.
“There remains very few buyers out there, and there are some growing concerns that we’re looking at a slowdown in global economic growth,” said Sean Lynch, co-leader of global equity strategy with the Wells Fargo Investment Institute.
The Dow Jones industrial average lost 127.94 points, or 0.73 percent, to 17,440.59. The Standard & Poor’s 500 index lost 12.01 points, or 0.6 percent, to 2,067.64, and the Nasdaq composite lost 48.85 points, or 1 percent, to 5,039.78.
It was the fifth straight loss for the U.S. market. The S&P 500 is still up about half a percent for the year. The Dow is down 2 percent, and the tech-heavy Nasdaq is up 6 percent.
The worries for investors this week started with an 8.5 percentage point plunge on the Shanghai market, the biggest one-day decline since February 2007.
Some analysts said Monday’s dive was set off by brokerages restricting credit used to finance stock purchases, also known as margin trading.
The price of oil fell to the lowest point since March on concerns that demand from China, the world’s second-biggest oil consumer, would slip. Benchmark U.S. crude fell 75 cents to close at $47.39 a barrel in New York. Brent crude, a benchmark used by many U.S. refineries, fell $1.15 to close at $53.47 a barrel in London.
