Global stocks suffered another rout Wednesday as US oil prices slid to fresh 12-year lows, heaping further pressure on financial markets from London and Paris to Moscow and New York.
Asia's main stock indices fell more than three per cent, as did a number of indices in Europe -- wiping out the previous day's rally spurred by hopes of Chinese stimulus.
With a loss of 3.5%, London joined a number of other markets in bear territory -- a fall of more than 20% from a recent peak.
Selling pressure also seized Wall Street much of the day, dumping the Dow as low as 15,450.56, a fall of about 3.5% at mid-session. US markets later clawed back some of their losses with a mid-afternoon rally that raised hopes that a bottom had been reached.
Still, the broad-based S&P 500 ended down 1.2%, taking its losses for the year to about 9.0%.
"It's not a pretty sight (on stock markets) with every single sector in the red... only serving to prove that yesterday's bounce was a short-lived relief rally," said Brenda Kelly, head analyst at London Capital Group.
"People are just assuming we're heading for a global recession and that it's something we're going to need to get out in front of," said Sam Stovall, chief investment strategist at S&P Capital IQ in New York.
Wednesday in Bangkok:
Driving the selling pressure once again was the sinking price of oil, which ended the day in New York down 6.7% at $26.55 a barrel, the lowest level since May 2003.
The oil rout has heavily reverberated in petroleum centers in the Middle East and Russia, where the ruble fell to a record low as the US dollar climbed past 81 rubles for the first time.
Between the plunge in oil prices and lower global growth "investors are having to digest a pretty toxic cocktail of factors that are weighing heavily on sentiment," said Michael Hewson, chief market analyst at CMC Markets UK.
But leading bankers sought to counter the narrative that a global recession is coming.
JPMorgan chief executive Jamie Dimon said he is still hoping the stock rout of early 2016 will turn out to be only a "speedy adjustment" that does not signal a major global slowdown.
Dimon noted that lower oil prices benefit some leading economies, such as India and Japan, as well as US consumers -- a view shared at rival bank Goldman Sachs.
"It feels like the degree to which the market is focused on the energy exposure has managed to discount the long-term tailwinds to the consumer in a reduction of costs across the globe," said Goldman Sachs chief financial officer Harvey Schwartz.
Petroleum-linked stocks slogged through another bruising session, with Dow members Chevron and ExxonMobil losing 3.1% and 4.2%, respectively.
Royal Dutch Shell slumped 7.3% after it said it expects a sharp decline in full-year net profits to between $1.6 billion and $2.0 billion for 2015 from almost $15.0 billion in 2014.
The biggest loser in the Dow was IBM, which tumbled 4.9% after reporting its 15th straight quarter of declining revenues and offering a muted forecast on 2016 earnings.
In Milan, the main share index fell 4.8% as worries about bad loans at Italian banks mounted.
Shares in Banca Monte dei Paschi di Siena fell 22%, with stock in a number of other small lenders also falling sharply as moves to consolidate the sector and take bad loans off their books have stalled.
New York - Dow: DOWN 1.6% at 15,766.74 (close)
New York - S&P 500: DOWN 1.2% at 1,859.33 (close)
New York - Nasdaq Composite: DOWN 0.1% at 4,471.69 (close)
London - FTSE 100: DOWN 3.5% at 5,673.58 (close)
Frankfurt - DAX 30: DOWN 2.8% at 9,391.64 (close)
Paris - CAC 40: DOWN 3.5% at 4,124.95 (close)
EURO STOXX 50: DOWN 3.3% at 2,882.59 (close)
Shanghai - Composite: DOWN 1.0% at 2,976.69 (close)
Tokyo - Nikkei 225: DOWN 3.7% at 16,416.19 (close)
Hong Kong - Hang Seng: DOWN 3.8% at 18,886.30 (close)
Euro/dollar: DOWN at $1.0890 from $1.0912 Tuesday
Dollar/yen: DOWN at 116.92 yen from 117.59 yen