WELLINGTON/SYDNEY (Dec 14): Asian stocks slid the most since September, while sovereign debt advanced as concern over the rout in crude oil and ructions in the junk-bond market boosted anxiety levels just days out from the Federal Reserve’s final meeting of 2015.

Commodity producers drove the regional equity benchmark toward its lowest level in almost 11 weeks as Asian shares carried on with Friday’s selloff, the worst day for global equities since Sept. 28. While assets exposed to China appeared to shrug off a round of better-than-expected economic data from the weekend, the South African rand surged after President Jacob Zuma backtracked on his appointment of a relatively unknown lawmaker as finance minister, reinstating a former fiscal chief to the job. The yuan weakened after China introduced a new index valuing it against a range of currencies.

“Sentiment at the moment is pretty weak,” Matthew Sherwood, head of investment strategy at Perpetual Ltd. in Sydney, which manages about $21 billion, said by phone. “We’re coming up to the first U.S. rate hike in nine years and we have an environment in commodities where prices continue to decline. The U.S. looks solid enough but it’s still the weakest recovery in history and we’ve got all of these stresses in the emerging markets.”

A wave of risk aversion has swept over markets as OPEC’s decision to scrap output limits continues to dog oil. Asset managers slid in the U.S. after the uneasy calm that had settled in markets in the countdown to the Fed’s interest-rate review was rocked after a high-yield mutual fund run by Third Avenue Management suspended redemptions. They were then joined by Stone Lion Capital Partners, fueling concern over stress in high-risk debt. Chinese retail sales to factory output came in better than expected, soothing concern over the slowdown there, a key concern for the Fed earlier in the year.

Stone Lion, a New York-based hedge fund with $1.3 billion under management, said Friday it was suspending redemptions in its $400 million high-yield fund as more investors demanded their money. The move came after Third Avenue said it was liquidating a $788 million credit mutual fund and delaying payouts to investors so it can avoid selling securities at fire- sale prices. The SPDR Barclays High Yield Bond exchange traded fund, regarded as a proxy for the junk-bond market, sank the most since 2011 on Friday.

The credit-market turmoil comes on the cusp of one of the most anticipated weeks of the year for investors, with traders pricing in 74 percent odds the Fed will end the era of near-zero borrowing costs Wednesday and hike rates. Tightening policy would solidify the Fed’s divergence from other major central banks, with policy makers in Europe and Japan still emphasizing measures to support growth.

The Bank of Japan’s quarterly Tankan gauge of sentiment among large manufacturers came in higher than economists expected Monday, with data on Japanese and euro-area industrial production due later in the day. India also reports on wholesale and consumer prices.

Stocks

The MSCI Asia Pacific Index slipped 1.8 percent as of 10:04 a.m. Tokyo time, sinking the most since Sept. 29 as mining stocks fell 2.4 percent. Energy producers slipped 1.6 percent in a ninth straight day of losses, their longest slump since September 2012.

The Topix index in Japan tumbled 2.8 percent, also the most since Sept. 29, while the Kospi index in Seoul sank 1.3 percent.

Australia’s S&P/ASX 200 Index slid 1.4 percent, with energy stocks extending losses at their lowest level since 2005. Materials producers also slumped in Sydney after iron ore retreated for a ninth straight week to end Friday at a record low. New Zealand’s S&P/NZX 50 Index, fell 0.8 percent, the most since the end of September.

The biggest U.S. ETF tracking Chinese stocks retreated 1.8 percent Friday to its lowest level since Oct. 21 as energy companies drove the Standard & Poor’s 500 Index down 1.9 percent. The U.S. benchmark slid 3.8 percent last week, its worst weekly performance since August.

S&P 500 e-mini futures added 0.1 percent in early Monday trading, rising with contracts on the Dow Jones Industrial Average and Nasdaq 100 Index.

In Hong Kong, futures on the Hang Seng and Hang Seng China Enterprises gauges lost at least 1.1 percent at the end of last week, while contracts on the FTSE China A50 Index were down 1.7 percent.

Currencies

The rand was the stand-out performer Monday, soaring as much as 6 percent to just below 15 per dollar before settling up 2.6 percent at 15.4758.

Zuma named the country’s second finance minister in four days Sunday, putting Pravin Gordhan - who held the post from 2009 to 2014 - back into the job after his removal of Nhlanhla Nene and appointment of David van Rooyen sparked an outcry. The U-turn is raising questions about Zuma’s standing within the African National Congress, given Gordhan successfully steered South Africa’s economy through its first recession in 17 years and was able to fend off pressure from labor unions to boost spending.

China’s currency retreated for a sixth straight day offshore, slipping 0.3 percent to 6.5519 per dollar after the publication of the new currency gauge. The move by the China Foreign Exchange Trade System is spurring speculation that policy makers want to reduce the currency’s link to the dollar and let it weaken further.

Australia’s dollar fell 0.3 percent and the South Korean won lost 0.7 percent as the greenback asserted itself amid the countdown to the Fed’s expected rate increase. The Bloomberg Dollar Spot Index, a gauge of the U.S. currency against 10 major peers, added 0.1 percent in a third day of gains.

Bonds

Government debt from Japan to Australia climbed Monday after the actions of Third Avenue and Stone Lion fueled concern that a rout in junk-debt markets will spread at the same time as money managers are faced with the shift in U.S. monetary policy.

Yields on 10-year Australian bonds fell the most, dropping five basis points to 2.80 percent, while similar maturity Treasuries pared back some of Friday’s gains. Rates on the U.S. notes climbed by two basis points, or 0.02 percentage point, to 2.15 percent after shedding 10 basis points last session.

“The current angst in the high-yield space echoes early developments during the global financial crisis,” Jason Wong, a currency strategist in Wellington at Bank of New Zealand Ltd., said in an e-mail to clients. “We will be watching developments closely in global credit markets to how much further they deteriorate.”

Commodities

West Texas Intermediate crude slipped 0.5 percent to $35.44 a barrel after sinking 11 percent last week, its worst five days in a year. Brent dropped 0.2 percent to $37.86 per barrel after closing at its lowest settlement since 2008 on Friday.

The surplus in oil will persist at least until late 2016 as demand growth slows and the Organization of Petroleum Exporting Countries shows “renewed determination” to maximize output, the International Energy Agency said Friday. There is “absolutely no chance” Iran will delay its plan to increase exports despite falling oil prices, Amir Hossein Zamaninia, Iran’s deputy oil minister, said in Tehran.

Copper slipped 0.2 percent in London, falling for the first time in three days. Nickel also retreated, losing 0.5 percent.

Gold for immediate delivery was little changed at $1,074.21 an ounce after rallying 0.3 percent on Friday to trim its seventh weekly drop in eight weeks.