Wall Street plunges again as global market rout deepens

(c) Sky News 2018: <a href="http://news.sky.com/story/ftse-100-sell-off-sees-16336bn-wiped-off-value-11523684">Wall Street plunges again as global market rout deepens</a>

Wall Street has suffered a second session of sharp declines as the global stock market rout showed no signs of abating.

New York's Dow Jones Industrial Average was more than 500 points, or 2%, lower during Thursday's session - while earlier in Britain the FTSE 100 saw £36bn wiped off the value of its constituent companies.

The ongoing market turmoil prompted American president Donald Trump to lash out at the US Federal Reserve - accusing the central bank of being "out of control" after a series of interest rate hikes.

But the Fed - led by Mr Trump's hand-picked chairman Jerome Powell - won backing from International Monetary Fund chief Christine Lagarde, who said that raising rates in economies like America's was "clearly a necessary development".

Mr Trump conceded to White House reporters that he was "not going to fire" Mr Powell.

In London, the FTSE 100 Index closed 138.8 points (1.94%) lower at 7006.9 on Thursday - the biggest fall in percentage terms since June.

It had briefly dipped below the 7,000 mark for the first time since April during a choppy session in the wake of a Wall Street slump on Wednesday and steep declines in Asian markets overnight.

The FTSE 100 has now lost more than 3%, or £60bn, in value in two days, and nearly 7% since the middle of last week.

Stock markets in Germany and France also saw further declines on Thursday.

Shares (Berlin: DI6.BE - news) in New York suffered a volatile session, briefly looking to stage a recovery from the previous brutal session at one stage before later veering back into the red.

The Dow Jones had seen its worst session for eight months on Wednesday as it fell by 3%.

:: Q&A: The global stock market sell-off explained

Analysts pointed to a cocktail of worries for stock market investors that have been building in recent weeks.

Chief (Taiwan OTC: 3345.TWO - news) among them is the rising path of US interest rates, which it is feared could put the brakes on the world's biggest economy by adding to borrowing costs for consumers and businesses.

Adding to the anxiety is the uncertainty caused by Mr Trump's trade war with China as well as the sharp upturn in yields on bonds - parcels of US government debt - which is diverting some investor attention from stocks.

Wall Street's downturn also comes off the back of recent all-time highs for the New York market.

Jasper Lawler, head of research at London Capital Group, offered this explanation: "The bloodbath for global equities comes as investors adjust to a world of higher US interest rates and US treasury yields.

"As concerns increase over higher interest rates dampening growth, investors are evolving their trading strategies accordingly."