- Belgian pathologist and literary star gives 'voice to the dead'
- East Timor fights new battles 25 years after independence vote
- Oil prices drop on easing fears over Middle East, most markets rise
- Reoxygenating oceans: startups lead the way in Baltic Sea
- King Charles III heads to Australia and Commonwealth meeting
- Wall Street stocks hit fresh records as oil prices slide
- Strike-hit Boeing leaves experts puzzled by strategy
- NASA launches probe to study if life possible on icy Jupiter moon
- EVs seek to regain sales momentum at Paris Motor Show
- NASA probe Europa Clipper lifts off for Jupiter's icy moon
- 'Unsustainable' housing crisis bedevils Spain's socialist govt
- Stocks shrug off China disappointment but oil slides
- Stocks diverge, oil retreats as China disappoints markets
- Trio wins economics Nobel for work on wealth inequality
- Ex-Stasi officer jailed over 1974 Berlin border killing
- Shanghai stocks gain after stimulus briefing as markets rally
- Shanghai stocks gain after stimulus briefing as Asian markets rally
- Nearly 90, but opera legend Kabaivanska is still calling tune
- With inflation down, ECB eyes faster tempo of rate cuts
- Is life possible on a Jupiter moon? NASA goes to investigate
- Ex-Stasi officer faces verdict over 1974 Berlin border killing
- Role of government, poverty research tipped for economics Nobel
- In milestone, SpaceX 'catches' megarocket booster after test flight
- In a first, SpaceX 'catches' megarocket booster after test flight
- Bangladeshi Hindus shrug off attack worries to celebrate festival
- Ubisoft fears assassin's hit over falling sales
- Vietnam, China hold talks on calming South China Sea tensions
- SpaceX will try to 'catch' giant Starship rocket shortly before landing
- Japan's former empress Michiko discharged after surgery: reports
- Japan's former empress Michiko discharged after surgey: reports
- 'Little Gregory' murder haunts France 40 years on
- Tariffs, tax cuts, energy: What is in Trump's economic plan?
- Amazon wants to be everything to everyone
- Jewish school in Canada hit by gunfire for second time
- With medical report Harris seeks to play health card against Trump
- China-EU EV tariff talks in Brussels end with 'major differences': Beijing
- Buried Nazi past haunts Athens on liberation anniversary
- Harris to release medical report confirming fitness for presidency: campaign
- Nobel prize a timely reminder, Hiroshima locals say
- China offers $325 bn in fiscal stimulus for ailing economy
- Small Quebec company dominates one part of NHL hockey: jerseys
- Boeing to cut 10% of workforce as it sees big Q3 loss
- Want to film in Paris? No sexism allowed
- US, European markets rise as investors weigh rates, earnings
- In Colombia, children trade plastic waste for school supplies
- JPMorgan Chase profits top estimates, bank sees 'resilient' US economy
- Little progress at key meet ahead of COP29 climate summit
- 'Party atmosphere': Skygazers treated to another aurora show
- Kyrgyzstan opens rare probe into glacier destruction
- European Mediterranean states discuss Middle East, migration
Stocks sink on higher interest rate fears
Stock markets tumbled on Thursday as investors fretted over the prospect of more US interest-rate hikes and the risk of recession.
Wall Street extended losses, with the Dow Jones Industrial Average falling 1.3 percent near midday.
European markets had their worst session since March 15, with London closing 2.2 percent lower while Frankfurt shed 2.6 and Paris dropped 3.1 percent as the prospect of more rate hikes sent government bond yields higher.
Hong Kong led Asian losses, falling by three percent.
Equities were weighed down heavily by minutes released Wednesday on the Federal Reserve's last interest-rate meeting, which indicated that more hikes lay ahead aimed at bringing down elevated inflation.
While growth remains healthy for now, the prospect of more rate hikes has stoked worries that the Fed could tip the economy into recession, weighing on risk sentiment.
"The clear hawkish guidance spooked markets," said Michael Hewson, chief market analyst at CMC Markets UK.
"This apparent willingness by central banks to crush demand, and risk pushing the economy into a recession to get inflation under control, is prompting investors to pare down their exposure to equity markets, hence today's sell-off," Hewson said.
The release Thursday of hotter-than-expected US employment data from payroll firm ADP, which estimated that private employers added 497,000 new jobs in June, raised the prospect of further Fed rate hikes.
In addition, survey data showed that the US services sector activity picked up pace in June to record six consecutive months of expansion, suggesting the Fed still has a way to go in its fight against inflation.
The strong figures come ahead of Friday's closely watched government jobs data, which will give the Fed more food for thought ahead of its next rate-policy meeting on July 26.
The strength of the US jobs market has surprised economists who expected a bigger hit from the Fed's aggressive policies to counter inflation.
"If a rate hike this month wasn't already nailed on, it probably is now," said Craig Erlam, senior market analyst at trading platform OANDA.
"It's no longer a question of if the Fed hikes this month but how many more after that?"
The Fed minutes caused US bond yields -- the rate the government pays to borrow money -- to rise as investors anticipate more Fed hikes.
The UK government's borrowing costs also rose as the yield on five- and 10-year bonds reached 15-year peaks. French and German bond yields also jumped.
The Fed minutes showed policymakers were split on the decision to stand pat last month after 10 straight rate increases, surprising some commentators and dealing a blow to hopes the bank was nearing the end of its tightening cycle.
Those backing an increase cited a tight jobs market, stronger-than-expected economic activity and few signs that inflation was on the path to the US central bank's two-percent target.
In the end, however, all 11 voting members on the policy committee supported the pause, though the minutes said "almost all" agreed more tightening will likely be needed this year.
Markets have also been worried about the health of the Chinese economy as another round of downbeat data this week highlighted the tough work facing authorities as they try to kickstart growth after years of zero-Covid-induced sluggishness.
Investors were also tracking Treasury Secretary Janet Yellen's four-day visit to Beijing, aimed at stabilising tense relations between the world's two largest economies.
- Key figures around 1550 GMT -
New York - Dow: DOWN 1.4 percent at 33,817.20 points
London - FTSE 100: DOWN 2.2 percent at 7,280.50 (close)
Frankfurt - DAX: DOWN 2.6 percent at 15,528.54 (close)
Paris - CAC 40: DOWN 3.1 percent at 7,082.29 (close)
EURO STOXX 50: DOWN 2.9 percent at 4,223.09 (close)
Tokyo - Nikkei 225: DOWN 1.7 percent at 32,773.02 (close)
Hong Kong - Hang Seng Index: DOWN 3.0 percent at 18,533.05 (close)
Shanghai - Composite: DOWN 0.5 percent at 3,205.57 (close)
Euro/dollar: UP at $1.0868 from $1.0857 on Wednesday
Pound/dollar: UP at $1.2712 from $1.2704
Dollar/yen: DOWN at 144.09 yen from 144.65 yen
Euro/pound: UP at 85.51 pence from 85.43 pence
Brent North Sea crude: DOWN 1.2 percent at $75.75 per barrel
West Texas Intermediate: DOWN 1.1 percent at $71.03 per barrel
burs-lth/ach
O.Hansen--CPN