Dow drops 900 points, and Japanese stocks suffer worst crash since 1987 on U.S. economy worries

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NEW YORK (AP) — Nearly everything on Wall Street is tumbling Monday as fear about a slowing U.S. economy worsens and sets off another sell-off for financial markets around the world. The S&P 500 was down by 3.

NEW YORK — Nearly everything on Wall Street is tumbling Monday as fear about a slowing U.S. economy worsens and sets off another sell-off for financial markets around the world.

It was the first chance for traders in Tokyo to react to Friday’s report showing U.S. employers slowed their hiring last month by much more than economists expected. That was the latest piece of data on the U.S. economy to come in weaker than expected, and it’s all raised fear the Federal Reserve has pressed the brakes on the U.S. economy by too much for too long through high interest rates in hopes of stifling inflation.

“The Fed could respond by stopping” the shrinking of its holdings of Treasurys and other bonds, he said. “That could at least by a symbolic action that they’re not blind to what’s going on.” Goldman Sachs economist David Mericle sees a higher chance of a recession following Friday’s jobs report. But he still sees only a 25% probability of that, up from 15%, in part “because the data look fine overall” and he does not “see major financial imbalances.”

Still, stocks of companies whose profits are most closely tied to the economy’s strength took heavy losses on the fears about a slowdown. The small companies in the Russell 2000 index dropped 4.4%, further dousing what had been a revival for it and other beaten-down areas of the market. Apple fell 5% Monday after Warren Buffett’s Berkshire Hathaway disclosed that it had slashed its ownership stake in the iPhone maker.

 

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