NEW YORK — Stocks fell for a fourth day Tuesday as concerns over a slowdown in China and talks about a bailout for Irish banks combined to push the Dow Jones industrial average to its largest one-day loss since August.

Asian markets started a global sell-off after South Korea’s central bank raised interest rates to curb inflation. Shares also fell in Shanghai and Hong Kong as speculation spread that China will take more steps to control the pace of its rapidly growing economy, which would dampen global demand for industrial goods.

“The fact that China is taking actions to tighten things up over there is having a big ripple effect here,” said Bruce Simon, the chief investment officer at Ballentine Partners.

In Brussels, European finance ministers ended a meeting without an agreement to bail out Ireland. However officials there said they’re moving ahead with preparations to support the country’s troubled banks.

The Dow Jones industrial average fell 178.47, or 1.6 percent, to 11,023.50. It dipped below 11,000 during the day for the first time since Oct. 20. Wal-Mart Stores Inc. and Home Depot Inc. were the only two companies to rise among the 30 stocks that make up the Dow.

The Standard & Poor’s 500 index fell 19.41, or 1.6 percent, to 1,178.34. The Nasdaq composite index fell 43.98, or 1.8 percent, to 2,469.84.

Advertisement

All 10 industry groups in the Standard and Poor’s 500, the index followed by most professional money managers, fell. Companies in the materials and energy industries lost the most ground.

Commodities prices also fell sharply as investors shed riskier assets and anticipated weaker demand for basic materials from China. The dollar jumped 0.9 percent against an index of six other currencies as investors sought safety.

Stock indexes have risen sharply since October following strong corporate earnings reports and the introduction of a $600 billion stimulus plan by the Federal Reserve. Some investors may have taken the global economic concerns as an opportunity to sell.

As Asian countries dealt with excessive economic growth and inflation, European finance ministers discussed a bailout for Ireland’s banks in hopes of preventing another crisis of confidence in Europe’s financial system. The country has so far refused any outside financial assistance.

A fiscal crisis in Greece resulted in a global swoon in stock prices in May as investors questioned the ability of European nations to protect the value of their shared currency, the euro. Greece was bailed out by fellow European nations and the International Monetary Fund.

 


Only subscribers are eligible to post comments. Please subscribe or login first for digital access. Here’s why.

Use the form below to reset your password. When you've submitted your account email, we will send an email with a reset code.