Markets took another beating on Monday. The S&P 500 fell 2.3 percent, the STOXX Europe 600 fell 1.3 percent, the Nikkei 225 fell 2.0 percent and the MSCI Emerging Markets Index fell 1.1 percent.
Money flowed into safe havens instead. US ten-year Treasury yields fell seven basis points to 2.57 percent while gold climbed 1.3 percent.
The uncharacteristically bad fall in the US stock market was exacerbated by surprisingly weak economic data. A report from the Institute for Supply Management on Monday showed that its manufacturing PMI fell to 51.3 in January, lower than the most pessimistic forecast in a Bloomberg survey of economists, from 56.5 in December.
However, another report on Monday showed that construction spending in the US rose 0.1 percent in December.
In Europe, the UK manufacturing PMI also fell to 56.7 in January from 57.2 in December but the eurozone manufacturing PMI rose to 54.0 from 52.7.
In China, recent manufacturing data had shown signs of slowing. Data on Monday showed that services activity there is also slowing. The National Bureau of Statistics said the official non-manufacturing PMI fell to 53.4 in January from 54.6 in December.
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