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 USA trade war with China and risks from a recent climb in interest rates. "This meltdown isn't just a mild case of the sniffles suggesting the latest sneeze from the USA equity market could morph into a global markets pandemic".
The benchmark S&P 500 and the Dow Jones Industrial Average fell almost 1.5 percent and at the day's low had retreated 3.7 percent and 3.6 percent, respectively, from their all-time highs.
What will fall hardest?
Rising bond yields have been drawing investors out of the stock market, and the stocks that have performed best over the past year took some of the biggest losses Wednesday. The Dow Jones Industrial Average fell 700 points in afternoon trading.
The Dow Jones Industrial Average fell 430 points Wednesday morning, or around 1.6 percent.
The previous bear market, from October 2002 to October 2007, collapsed in the face of the global financial crisis, precipitated by raising interest rates in the face of inflation that revealed the vast scale of subprime mortgages and other badly collateralized loans.
Wednesday's sell-off only adds to what's already been a rough month for USA stocks.
After a long stretch of relative calm, the stock market has suffered sharp losses over the last week as bond yields surged.
The S&P 500 index sank 73 points, or 2.5 per cent, to 2,807 as of 3:30 p.m.
"What we're seeing here is the market positioning for potential lower growth".
The Treasury held the following auctions: three-year note at 2.989%, 10-year note at 3.225%.
Canadian stocks also fell on Thursday, weighed down by a more than 2-per-cent drop in healthcare and energy stocks amid a broad based sell-off in global equities.
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.
Amazon ($AMZN) was the biggest loser in the sector, losing more than $56 billion in market cap on Wednesday alone.
For stock investors, the recent spike in bond yields may be prompting some uncomfortable deja vu. Stocks plunged in Taiwan and fell across Southeast Asia.
United States gold futures settled up $1.9, or 0.16 percent, at $1,193.4.
Japan's Nikkei 225 added 0.2 percent, South Korea's Kospi dropped 1.1 percent and the Hang Seng in Hong Kong gained 0.1 percent.
The dollar index fell 0.17 percent, with the euro up 0.25 percent to $1.1518.
Oil prices slumped to two-week lows as global stock markets fell, with investor sentiment made more bearish by an industry report showing US crude inventories rising more than expected. It has fallen 7.5 percent in just five days.
The Australian dollar slipped against major currencies, down to 70.7 USA cents, 53.6 British pence, 61.4 Euro cents and 79.5 Japanese yen.