Australia's share market has joined Wall Street in a correction, as the major local stock indices smash through 10 per cent of losses since their recent record highs.
In the space of just a week, the ASX 200 has gone from a record closing high of 7162 last Thursday to 6441 by 10.10am (AEDT), once the market had fully opened.
Friday's 3.25 per cent slump has taken the losses above 10 per cent since that record, marking the beginning of what traders call a "correction". To enter a share market "crash" most analysts consider that the share market would need to lose another 10 per cent from here.
All sectors of the market are in the red, with the major miners down 3.5-4.3 per cent and the big banks off 2.5 to 3.5 per cent.
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Wall Street's main indexes plunged more than 4 per cent overnight, pushing the slide from last week's peak to more than 12 per cent and confirming US shares are deep into a correction and potentially heading for a bear market.
Global shares are now at a four-month low, having retreated from record highs at a rapid pace.
The indexes have been hit by their steepest weekly pullback since the 2008 global financial crisis, as new coronavirus infections reported around the world surpassed those in mainland China.
"Stocks and bonds say we're doomed," Chris Rupkey, the chief financial economist for MUFG Union Bank, told Bloomberg.
"Anyone who has a better idea for what lies ahead please let us know because right now the direction ahead for the economy is straight down."
US traders were particularly rattled by the Centres for Disease Control and Prevention confirming a COVID-19 infection in California in a person who apparently had no relevant travel history or exposure to another known patient.
"It's not a China thing, it's becoming more global … in terms of the spread of the virus and its economic impact," said Willie Delwiche, investment strategist at Robert W Baird in Milwaukee.
"There's a lot of uncertainty right now about where that impact lands … it's also possible that forecasts are over-reacting to the downside."
By the close, both the S'P 500 and Dow Jones Industrial Average had slumped 4.4 per cent, while the tech-heavy Nasdaq fell even further, plunging by 4.6 per cent.
European markets had also dropped sharply earlier in the session, with the EuroStoxx 50 off 3.4 per cent and London's FTSE 100 down 3.5 per cent.
The Australian dollar remains surprisingly resilient given the global share market panic, holding firm at 65.77 US cents.