Stock markets have tumbled around the world with analysts blaming concerns over Italy’s finances, ongoing trade fears and Saudi tensions for the falls.
London’s FTSE 100, which is already on track for its worst monthly performance in a decade, was down 1.6% in late afternoon trading.
European stocks also fell with France’s Cac and Frankfurt’s Dax down almost 2%, falling for the fifth day in a row.
US stocks also fell sharply with all three major indexes down over 2%.
The S&P 500 is on course for its worst month since September 2011.
The falls followed a downbeat performance from Asian stocks overnight. The MSCI’s world share index is trading close to its lowest level for a year.
Analysts said it was hard to pinpoint the global falls on one particular factor.
In Europe, they said the sell-off had been exacerbated by fears over the situation in Italy, which has the second-highest national debt in the eurozone.
The European Commission has told the country to revise its budget, the first time it has ever made such a request.
Meanwhile, there are also fears over the impact on trade of the current situation in Saudi Arabia, where the Kingdom is facing pressure over the death of prominent Saudi critic journalist Jamal Khashoggi.
The country is one of the world’s largest oil exporters and investors are concerned about the threat of possible sanctions.
ING strategist Benjamin Schroeder blamed “a concoction of concerns” for the falls, saying investors’ overall sentiment was suffering from trade tensions, fears over Italy and Brexit.
While Charles Schwab analysts said these general fears were “exacerbating already skittish global sentiment”.
Neil Wilson, chief market analyst for Markets.com, said the general tone was “not good”. He said it was “hard to say” what was driving the falls, but “the old adage that the market hates uncertainty holds true”.
“But it’s not all geopolitical noise and fears about rates – some notable earnings announcements have also rocked confidence,” he said, noting that disappointing performances from 3M and Caterpillar had hit the Dow’s performance.