Sydney/Shanghai: Asian share markets sank in a sea of red on Thursday after Wall Street suffered its worst drubbing in eight months, a conflagration of wealth that could threaten business confidence and investment across the globe.
The Shanghai Composite index plunged 5.2 per cent to its lowest level since November 2014 and Japan's Nikkei 225 fell by an unusually wide margin of nearly 4 per cent. Markets across Southeast Asia recorded similar declines.
Meanwhile, President Donald Trump responded to the US stock market sell-off by again criticising the Federal Reserve for raising interest rates, calling it a "mistake".
Innes, the Singapore-based head of Head of Trading for Asia Pacific with OANDA, attributed the slide to a combination of factors, including the possibility further interest rate hikes and the battle over tariffs between the USA and China.
On Wednesday, President Donald Trump said the Federal Reserve "is making a mistake" with its campaign of rate increases.
"I think the Fed has gone insane", he charged.
Markets in Hong Kong, South Korea, Australia and Southeast Asia recorded similar declines.
It meant MSCI's 24-country emerging market index.MSCIEF was having its worst day since early 2016, after Wall Street's swoon had given the 47-country world index equivalent.WORLD its worst day since February.
A man is seen behind an electronic board displaying the Nikkei average and Japanese yen rate againt the USA dollar at the Tokyo Stock Exchange in Tokyo, Japan, October 11, 2018. -Chinese tariff fight over Beijing's technology policy. US officials have accused China of meddling in its midterm elections and stealing trade secrets from its companies through spies.
The International Monetary Fund cut its outlook for global growth this week, citing interest rates and trade tensions.
Tokyo's Nikkei 225 gave up 3.9 percent to 22,590.86 and the Shanghai Composite lost 5.6 percent to 2,573.11. The Kospi in South Korea fell 4.4 per cent to 2,129.67.
Hong Kong's Hang Seng index shed 3.5 percent to 25,266.37. Australia's S&P/ASX 200 slipped 2.4 per cent to 5,906.00.
Stocks plunged in Taiwan and fell across Southeast Asia.
Asian stocks slumped in early trade as concerns about higher United States interest rates and a global trade war prompted investors to sell risk globally. The Nasdaq composite, which has a large contingent of technology stocks, was 4.1 percent lower at 7,422.05.
The benchmark Dow index fell 831 points to close at 25,598.74 on Wednesday, wiping out 3.2 percent of its value in the sharpest drop since February.
Just a day before the start of America's third-quarter earnings season, signs are mounting that companies might not be able to deliver the runaway growth that's bolstered equities so far in 2018.
Apple and Amazon, the two most valuable companies in the S&P 500, each had their worst day in 2½ years. The S&P technology sector dropped 4.8 per cent, with Apple Inc down 4.6 per cent.
Francis Tan, an investment strategist at UOB private bank, believes the markets will likely pick up in the U.S. session.
"The valuation of United States stocks, especially tech stocks, is still pretty high and there could be some profit taking actions now", Mr Tan explained.
The euro was at $1.1550 EUR=, up from a low of $1.1429 early in the week. The dollar fell back to 112.10 yen, a telling retreat from last week's 114.54 peak.
Oil futures fell. US crude gave up $1.39 to $71.78 a barrel.
"Earnings are really important because that was part of the concern that sparked the sell-off", Darrell Cronk, president and chief investment officer at Wells Fargo Investment Institute, told Bloomberg TV in NY. Brent crude, the worldwide standard, dropped $1.18 to $81.91 a barrel.