Markets sink 2% on Evergrande fears; banks slide 4%; German Dax down 3%

The pan-European Stoxx 600 index was down by around 2.2% in early afternoon trade with basic resources, with their heavy exposure to China, leading the losses, CNBC reported.

European banking stocks also tanked 4% on average, and were set to post their worst session so far this year. The German Dax was down around 2.9%, also on track for its worst trading session of the year.

The lower open for Europe come as global stocks continue to struggle in September, traditionally a weak month for markets, with the Dow Jones Industrial Average seeing three straight weeks of losses for the first time in 2021.

Hong Kong’s Hang Seng index led losses among Asia-Pacific markets in overnight trade on Sunday, with shares of embattled Chinese developer China Evergrande Group continuing to drop.

Markets in mainland China, Japan and South Korea were closed on Monday for holidays.

Global markets are also experiencing some jitters ahead of the U.S. Federal Reserve’s highly anticipated September meeting, which starts Tuesday.

Fed Chair Jerome Powell will hold a press conference Wednesday at the conclusion of the two-day meeting with investors keen to pick up any indications about the Fed’s tapering of its easy monetary policy.

Powell has said the tapering could occur this year but investors are waiting for more specifics, particularly after mixed economic data released since Powell’s last comments. U.S. stock futures were mixed in overnight trading Sunday.