Stocks fall on bleak Chinese report

September starts slowly after U.S. markets had closed their worst month in more than three years.

new york» Stocks plunged again Tuesday, continuing a rocky ride for Wall Street, after an economic report out of China rekindled fears that the world’s second-largest economy is slowing more than anticipated.

The sell-off adds to what has been a difficult few weeks for U.S. and international markets. U.S. stocks just closed out their worst month in more than three years. The drop Tuesday also dashed hopes that, after some relatively calm trading Friday and Monday, the stock market’s wild swings were coming to an end.

“This market remains fragile,” said Jack Ablin, chief investment officer at BMO Private Bank. “There’s nothing fundamentally wrong with the U.S. economy, but we are going through this correction process. We’ve got a rocky road ahead of us.”

Stocks started the day sharply lower and never recovered, with the Dow Jones industrial average falling as much as 548 points. No part of the market was spared. All 10 sectors of the Standard & Poor’s 500 index fell more than 2 percent. Just three stocks in the S&P 500 closed higher.

“Monday’s relatively peaceful markets are a distant memory as Chinese data and shares sparked another severe … reaction from the developed world,” said John Briggs, head of fixed income strategy at RBS.

In the end, the Dow lost 469.68 points, or 2.84 percent, to 16,058.35. The S&P 500 fell 58.33 points, or 3 percent, to 1,913.85 and the Nasdaq composite fell 140.40 points, 2.9 percent, to 4,636.10.

As it has been for several weeks, the selling and problems started in Asia.

An official gauge of Chinese manufacturing fell to a three-year low last month, another sign of slowing growth in that country. The manufacturing index, which surveys purchasing managers at factories, dropped to a reading of 49.7 in August from 50.0 in July. A reading below 50 indicates a contraction.

China’s stocks sank on the news, with Shanghai Composite Index closing down 1.2 percent. The index has lost 38 percent of its value since hitting a peak in June.

Investors moved into traditional havens such as bonds and gold Tuesday. Bond prices rose, pushing the yield on the benchmark 10-year Treasury note down to 2.16 percent from 2.22 percent Monday. Gold rose $7.30, or 0.6 percent, to settle at $1,139.80 an ounce.

Faced with the possibility of slowing demand in China, the commodity markets once again took the brunt of the hit.

U.S. crude oil fell $3.79 to close at $45.41 a barrel in New York. Brent Crude, a benchmark for international oils used by many U.S. refineries, fell $4.59 to close at $49.56 in London.

Energy stocks were once again among the biggest decliners. Exxon Mobil fell nearly 4 percent and Chevron fell 2.5 percent. Exxon is down 22 percent this year, Chevron 30 percent.