Global stock markets have tumbled with investors unsettled by the continued slide in oil prices and fears about the impact on global growth.
Germany’s Dax, the UK’s FTSE 100, and the Cac 40 in Paris were all down by about 3%, wiping out the gains recorded on January 19.
The drop in the FTSE puts it on the brink of a so called “bear market” – a 20% fall from April’s all-time high.
The falls came after Asian stocks closed sharply lower.
Dubai markets closed at a 28-month low, while in Japan shares fell to their lowest level since October 2014.
Top emerging market shares and currencies were also caught up in the turmoil, with the Russian ruble hitting a new record low of 80.295 against the dollar.
The downwards move came after oil prices continued to slide, with the price of international benchmark Brent Crude down 2.4% at $28.08 a barrel, around a 12-year low.
The oil price has plummeted 75% since mid-2014 as oversupply, mainly due to US shale oil flooding the market, has driven down the cost of the commodity.
At the same time, demand has fallen because of a slowdown in economic growth in China and Europe.
The world’s energy watchdog warned on January 19 that the market could “drown in oversupply”.
The International Energy Agency, which advises countries on energy policy, said it expected the global glut to last until at least late 2016.
The IMF’s decision on January 19 to downgrade its global growth forecast for this year and issue a warning about the outlook added to the dark mood among investors.
World stocks are now at their lowest levels since 2013, with the MSCI world equity index down 9.9% in January, its biggest drop since 2009.
Analysts said they expected the volatility to continue.
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