Stocks slide on rumbles of a weaker global economy

Stocks in the U.S. and across the world slumped Tuesday following fresh signs the global economy is weakening. The International Monetary Fund trimmed its economic forecasts for 2019 and 2020 and pointed to risks including trade tensions and rising interest rates. China's government said its economy grew in 2018 at the slowest pace since 1990.

Technology companies skidded, and so did industrial companies, which were hurt by the slower growth forecast as well as some weak fourth-quarter earnings. Bond prices climbed as investors looked for safer investments, and oil prices fell as traders expected weaker demand.

The Dow slid 302 points, or 1.2 percent, to close at 24,404. The S&P 500 stock index lost 1.4 percent, the tech-heavy Nasdaq fell 1.9 percent, and the Russell 2000 index of smaller-company stocks dropped 1.8 percent.

Stocks in Europe and Asia also fell. Global markets have rallied over the last month as investors began to feel that a slowdown in the world economy might not be as painful as they feared. Even with the decline Tuesday, the S&P 500 is up 5.1 percent in 2019 and has jumped more than 12 percent since hitting its recent low on Dec. 24.

The IMF now says the global economy will grow 3.5 percent this year, down from its previous forecast of 3.7 percent. Managing Director Christine Lagarde said the global economy was growing more slowly than expected as risks increase. She also said the bank cut its estimate for growth in 2020 to 3.6 percent from 3.7 percent.

China on Monday reported its economy expanded by 6.6 percent in 2018. This was the slowest pace of growth since 1990 and it fueled fears a trade dispute with Washington is putting a drag on the world's second largest economy.

"The IMF's prognosis is fairly dire, and the prescription is a sensible approach of preventive management; to avoid escalating trade disputes, lower tariffs and build fiscal or financial buffers," wrote Vishnu Varathan of Mizuho Bank in a note to clients.

Homebuilders sank after U.S. home sales cratered in December and price growth declined to the lowest level in more than six years. The National Association of Realtors said Tuesday that sales of already-built homes plunged 6.4 percent. Years of rising prices and the more recent increase in mortgage rates have both affected sales, as has the limited number of homes available for sale.

"Home prices have continued to rise up, but the pace has slowed," Jim O'Sullivan, chief U.S. economist with High Frequency Economics, said in a research note.

Overseas, the British FTSE 100 index slid 1 percent. Germany's DAX and France's CAC 40 both gave up 0.4 percent. Japan's Nikkei 225 index shed 0.5 percent and the Kospi in South Korea sank 0.3 percent. Hong Kong's Hang Seng lost 0.7 percent.