Japan’s Nikkei 225 share benchmark has fallen 7.1%, its biggest point drop since November 1990.
Other Asian markets have also plunged on opening as panic spread following Wall Street’s record-breaking loss.
New York led the downwards spiral as the Dow Jones suffered its worst daily points decline in its 122-year history, wiping out all its 2018 gains.
Shortly after New York closed, Tokyo’s Nikkei dived more than 5% in its opening minutes on Tuesday while Hong Kong’s Hang Seng Index was down to 4.32%.
Sydney plummeted by 3.2% – ASX’s worst day since last June.
Singapore was 2.3% down, Seoul 3%, Taipei 3.7%, Manila 2.7% and Shanghai 2.1%.
Wall Street investors sparked the global panic after months of surges fuelled by optimism over the US economy, corporate earnings and the global outlook.
Market experts said it represented the biggest fall ever recorded in a trading session for the Dow though it later closed 1,175 points or 4.6% lower. The main S&P 500 and Nasdaq saw similar falls.
Some analysts saw the declines as a return to volatility following a benign 2017.
But Naeem Aslam, chief markets analyst at Thinkmarkets, believed automated trades – which kick in to reflect sharp market movements – contributed to the steepest declines.
“The regulators need to address this issue because a drop like this is worse than anything on the street, we are talking about real companies with revenue streams.”
He added: “The most interesting aspect was that we didn’t see the mammoth move in gold and the reason for that is because it was the war of machines and this was not 1987- at least for now.
“The volatility index on the other hand exploded quickly and surpassed levels which we have not seen in years.”
Stock exchanges in London and New York have been trading at record highs recently, helped by Donald Trump’s tax cut policies and burgeoning global growth.
But a key jobs report on Friday – showing strong growth in the US labour market – appears to have been the catalyst for the rally to come to a halt, at a time when some observers have suggested a so-called correction might be due.
Stronger than expected wage growth in the world’s biggest economy could mean sharper increases in interest rates should the US Federal Reserve feel the need to curb inflationary pressure.
Those higher rates will see shares start to look less attractive compared to other investments, particularly with bonds – parcels of government debt, which are offering higher yields.
- China revokes three Wall Street Journal reporters' credentials
- Asian shares sink on mounting worries over China outbreak
- Market needs more time to correct; book profits in speciality chemical stocks
- Stock market closed today on account of Maha Shivratri
- Driver is pulled from icy water by emergency responders in Fort Collins after car plunges into pond
- Memo to the RSC: east Asians can be more than just dogs and maids
- China reports fall in new coronavirus cases but concerns grow over rising global spread
- Where are all the 'free' first or business class seats?
- Shares fall in Asia as virus outbreak hits profits, events
- Stock bulls just got a wake-up call in a world of confusion