A global measure of equity prices fell to a 1-year low on Thursday as Wall Street extended its October slide into a sixth session as investors feared an escalating US trade war with China and risks from a recent climb in interest rates.
The biggest driver for the market over the last week has been interest rates, which began spurting higher after several encouraging reports on the economy.
US stocks plunged to their worst loss in eight months on Wednesday as technology companies continued to drop.
United States government bonds resumed a selloff after rising to multi-year highs last week, with the 2-year yield rising to 2.906%, its highest level since June 2008.
Wall Street stocks plunged Wednesday, with major indices losing more than three percent in a selloff prompted by the sudden jump in USA interest rates.
But historically, a monthly move of one to two deviations, or 20 to 40 basis points now, would result in flat S&P 500 returns. With a humming U.S. economy, the Federal Reserve is expected to continue hiking interest rates.
USA stocks plunged Wednesday as investors ramped up their selling of high-flying technology and internet stocks.More news: Michael responsible for child's death in Georgia
Stocks fell Wednesday as Wall Street sweats over global growth prospects and a bond selloff.
The S&P 500 index sank 95 points, or 3.3 percent, to 2,786, its fifth straight drop.
"It's a risk-off environment as investors are focusing on spiking yields and taking profits off the table as they are concerned about whether the bull market is actually coming to an end", said Ryan Nauman, market strategist at Informa Financial Intelligence in Zephyr Cove, Nevada.
It sets up the Australian sharemarket for steep losses to open the session, with futures at 7:35am AEDT pointing to a fall of 109 points, or 1.8 per cent, at the open.
The 10-year Treasury yield rose to 3.22 percent from 3.20 percent late Tuesday after earlier touching 3.24 percent.
The stock market as a whole, however, had solid reasons behind the fall: rising interest rates.
Aphria Inc., which tumbled 3.6 per cent, was among the top decliners on the main index, after the cannabis producer said there was no investment deal in place. In 1987, stocks dropped more than 20 percent on a single day-Black Monday, Oct. 19-after a strong rally crashed into the Persian Gulf turmoil and trade deficits.More news: Amazon Great Indian Festival sale: 10 top offers on refrigerators, washing machines
USA gold futures settled up $1.9, or 0.16 percent, at $1,193.4.
For stock investors, the recent spike in bond yields may be prompting some uncomfortable deja vu. In Asia, Tokyo's Nikkei 225 gave up 3.9 per cent and Hong Kong's Hang Seng index shed 3.5 per cent.
USA crude fell 1.98 per cent to $71.72 per barrel and Brent was last at $81.30, down 2.15 per cent on the day.
"As stocks go up, tech goes up more than the stock market".
The Japanese yen strengthened 0.01 per cent versus the greenback at 112.29.More news: Dow Falls 430 Points as Bond Yields Surge and China Tensions Grow
- Nokia 7.1 Plus Expected to Launch Today in India
- Saudi envoy to US expresses shock at false reports
- Strictly Come Dancing contestant Seann Walsh under fire from ex-girlfriend
- Hillary, Bill Clinton To Make 13 Joint Appearances, Including At The Forum
- Selena Gomez Wrote About 'Negative Comments' in Last Instagram Post Before Hospitalization
- Netflix's The Witcher Casts Ciri and Yennefer
- Bipartisan Senate Group Forces U.S. Probe of Saudi Journalist's Disappearance
- Taylor Swift calls on fans to vote during AMA acceptance speech
- Google is extending Home Control from this week
- Minnesota kids diagnosed with rare, polio-like disease