U.S. President Donald Trump has been briefed on Wednesday's stock market sell-off, a senior White House official told CNBC, as the Dow Jones Industrial Average dropped more than 3 percent in one day and the S&P 500 marked its biggest daily decline since February.
The losses were widespread, and stocks that have been the biggest winners on the market the last few years, including technology companies and retailers, suffered steep declines.
Apple gave up 4.6 per cent to US$216.36 and Microsoft dropped 5.4 per cent to US$106.16.
USA 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.
The rise in US Treasury yields has been bolstered by good US economic data that has reinforced expectations of multiple rate hikes over the next 12 months by the Federal Reserve.
Sears nosedived after the Wall Street Journal reported that the struggling retailer hired an advisory firm to prepare a bankruptcy filing that could come within days.
The S&P 500 was down 31 points, or 1.1 percent, at 2,849 as of 10 a.m.
The Dow Jones Industrial Average lost 342 points, or 1.3 percent, to 26,090.
The Nasdaq composite tumbled 315.97 points, or 4.1 percent, to 7,422.05.
Amazon isn't counted in the S&P 500 IT index but it's worth noting that the company's stock dropped by over 6 percent, a loss of $68 billion in market cap.
Majorca Floods: Two Brits Reported Dead After Heavy Rain Sweeps Island
Lawmakers held a minute's silence before the weekly prime minister's question time in parliament on Wednesday morning. Torrential rainstorms deluged the town of Sant Lorrenc, about 65km east of the capital Palma, yesterday evening.
Stock in all 30 blue-chip index companies fell, with Boeing and Caterpillar dropping at least 3.8 per cent.
Traders work on the floor at the closing bell of the Dow Industrial Average at the New York Stock Exchange on Wednesday.
The Nasdaq composite fell 73 points, or 1 percent, to 7,663.
Bond prices fell. The yield on the 10-year Treasury rose to 3.23 per cent.
Technology shares tumbled on fears of slowing demand, while bond yields ended lower after seeing multi-year highs earlier this week. The energy sector was close behind with a 2.9 percent loss, as oil extraction in the Gulf of Mexico shutting down due to the hurricane. Nvidia wasn't spared either as the GPU-manufacturer out of Santa Clara, CA saw a drop of seven-and-a-half percent itself which brings its year-to-date market gain to 33 percent. Natural gas rose 0.6 percent to $3.28 per 1,000 cubic feet. Silver dipped 0.5 percent to $14.33 an ounce. Copper fell 0.9 per cent to $2.78 a pound.
The CAC 40 in France dropped 2.1 percent, Germany's DAX lost 2.2 percent and the FTSE 100 in London fell 1.3 percent.
Japan's Nikkei 225 added 0.2 per cent, South Korea's Kospi dropped 1.1 per cent and the Hang Seng in Hong Kong gained 0.1 per cent. Many stock-market observers pin the start of the current bull market, the longest since World War II, at March 9, 2009.
Investors may want to shift out of momentum and into more defensive stocks - companies that aren't as expensive and also pay healthy, stable dividends. Brazil's Bovespa lost 2.5 percent and the Merval in Argentina sank 2.2 percent.
The Japanese yen strengthened 0.53 percent versus the greenback at 112.36.