The rout in global stocks is being fueled by investors seeking to reduce leverage as central bank run out of options to prop up economies, according to Janus Capital Group Inc.’s Bill Gross.

“Real economies are being levered with QEs and negative interest rates to little effect,” Gross, who manages the $1.3 billion Janus Global Unconstrained Bond Fund, said in an e-mail responding to questions from Bloomberg. “Markets sense this lack of growth potential and observe recessions beginning in major emerging-market economies.”

While overseas economies are wobbling, the U.S. remains an island of stability, according to money managers such as Omar Aguilar, chief investment officer for equities at Charles Schwab Corp.

A Stable Economy

"This is a financial crisis and not an economic crisis," Aguilar said during a conference call. "The U.S. economy is stable."

Data on the housing market, unemployment and government spending still support U.S. gross domestic product growth, Aguilar said. Oil markets will rise later this year when supply drops in response to current low prices, according to Mihir Worah, co-manager of the $89.9 billion Pimco Total Return Fund.

“We continue to expect oil markets to balance in the second half of the year, and expect oil prices to move higher from current levels as a result,” Worah said in an e-mail. “While we aware of the risks, we still expect U.S. GDP growth to come in around 2 percent.”

David Herro, manager of the $24 billion Oakmark International Fund, said low energy prices should support consumer spending, the biggest part of the U.S. economy.

“I don’t think the drop in equity prices is at all warranted by economic fundamentals,” Herro wrote in an e-mail.

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