Stocks swooned on Monday as investors fretted that the governments of the world’s two largest economies — China and the United States — could act in ways that would undercut the nascent global economic recovery.

The sell-off started in Asia and spread to Europe before landing in the United States, where the S&P 500 fell 1.7%, the worst one-day slide since mid-May. It would have been worse were it not for a late rally; the index was down as much as 2.8% in the afternoon.

The Chinese government’s unwillingness to step in and save a highly indebted property developer just days before a big interest payment is due signaled to investors that Beijing might break with its long-standing policy of bailing out its homegrown stars.

And in the United States, investors were worried that the Federal Reserve could soon begin cutting back its purchases of government bonds, which have driven the sharp rebound in stocks and helped prop up corporate profits since the coronavirus pandemic hit.

Before this month, Wall Street was enjoying a seven-month run that had lifted stocks more than 20%, as investors seemed to shrug off any bad news. But there has been a clear shift in the market’s tone since the high on Sept. 2, and it worsened on Monday because of the spiraling debt woes of Evergrande, a vast Chinese real estate business that has struggled to meet its obligations, worrying investors there and around the globe.

Evergrande’s struggles are an important consideration for Chinese financial markets: The company owes more than $300 billion to a range of lenders, and a default on its debts would have ripple effects on China’s economy. Investors were left to wonder about which other real estate companies were likely to stiff creditors, and whether banks and insurers that lend to them could also be hamstrung.

“We have been asked repeatedly in recent weeks if ‘this’ — a likely Evergrande default — is China’s Lehman moment,” wrote analysts at Barclays in a client note Monday, referencing Lehman Bros., the investment banks whose 2008 collapse was a seminal moment in the last financial crisis.