GS Goldman Sachs Group Inc

U.S. financial stocks fell Monday, as investors worried that banks could be hurt by low energy prices and slowing economic growth around the world.

Financial stocks in the S&P 500 fell 3.7%, more than the broader market. The sector is the worst performer in the index so far in 2016, falling more than 16%. The KBW Nasdaq Bank index of big U.S. commercial banks fell 4.1%, down almost 19% for the year.

Morgan Stanley fell 7.3% while Goldman Sachs Group Inc. was down 6.5%.

Some analysts said the selling reflects investor fears that banks and financial stocks may be more vulnerable than others to weak growth at a time when the U.S. economy appears sluggish and corporate earnings are under pressure. Worries about banks' exposure to debt from energy producers, hard hit by falling oil prices, as well as declining shares for European bank stocks were also contributing to the selloff, several said.

In Europe, Deutsche Bank fell 9.5%, while Barclays, BNP Paribas and UniCredit were all down more than 5%, outpacing declines in the broader markets. Adding to concerns about banks, Germany's financial watchdog BaFin effectively closed the German unit of Maple Financial Group, which is under investigation by German prosecutors over alleged tax irregularities.

BaFin said Sunday Maple Bank didn't pose a threat to the stability of the financial system. A spokeswoman for Maple in Germany said customer deposits would be protected in accordance with deposit-insurance law.

Investors in recent weeks have been retreating from stocks that appear susceptible to a broad economic downturn, highlighted by a selloff in technology companies Friday that were among the best-performing in recent years.

"While energy's been bad, that's already had its selloff in some respects," said Bill Nichols, head of U.S. equities at Cantor Fitzgerald LP. "Now that's spilling over into real estate, banks and tech. The big engines of growth are underperforming in wide swaths."

Some investors said financial stocks have been suffering in part because an interest rate this low implies weak economic growth and no Federal Reserve rate increase for the foreseeable future, which will mean continued pressure on their profits. Rising rates tend to boost banks' earnings by widening the gap between the interest they charge on loans and what they pay for deposits, a spread sometimes known as the net interest margin.

Investors seeking safety drove U.S. 10-year Treasury yields down to 1.741% from 1.846% Friday.

"The 10-year Treasury at 1.75% is not good for financials," said R.J. Grant, associate director of equity trading at KBW Inc.

Shares of asset managers also fell sharply Monday. T. Rowe Price Group declined 5.9% while Legg Mason fell 5.3% and BlackRock Inc. dropped 5.5%. Shares of publicly traded U.S. asset managers have fallen in recent months, finishing 2015 down 18% on average, far behind the S&P 500 index, according to Morningstar Inc.

Investors have pulled about $40 billion from U.S. stock mutual funds and exchange-traded funds so far this year, leading to net outflows every week, according to the Goldman Sachs research department.

Write to Aaron Kuriloff at aaron.kuriloff@wsj.com

(END) Dow Jones Newswires

February 08, 2016 15:05 ET (20:05 GMT)

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