The equity market sell off continued on Thursday and Friday, pushing several indicators in the US and Asia into official correction territory.
A correction is defined as a fall of 10% from the most recent cyclical peak, and this was achieved in the US overnight by both the Dow Jones Industrial Average and the S&P 500, which ended Thursday with cumulative losses of 10.36% and 10.16% respectively.
The Nasdaq Composite was not far behind, but remained short of correction territory at the close on Thursday, with cumulative losses since its most recent peak of 9.71%.
Nikkei and Hang Seng
In Asia on Friday, most stock indicators suffered heavy daily losses, but few were propelled into official correction. Among those that were, however, were the biggest: Japan's Nikkei 225, with cumulative losses of 11.31% and Hong Kong's Hang Seng down 11.36%.
While most European markets were also down sharply on Thursday, and opened lower on Friday, they remained short of correction levels, with the EuroStoxx 50 down 8.47% since its most recent peak, and London's FTSE 100 with cumulative losses of 8.37%.
The Vix index, a measure of volatility on the S&P 500 often colloquially called Wall Street's "fear gauge" closed on Thursday at 33.46, up more than 20% on the day. On Tuesday, the Vix spiked up to 50.3 - its highest peak in three years and its biggest one-day rise ever.
Bank of America Merrill Lynch (BAML) data suggested the week had seen record equity outflows of $30.6bn, of which $4bn found its way into bond markets.