Global stock markets slumped yesterday as investors were seized by fears that the US Federal Reserve hiking interest rates could choke economic growth.
Wall Street stocks, which had tumbled Wednesday after the Fed defied unprecedented pressure from President Donald Trump to raise rates, slid further yesterday. 
In Japan, the Nikkei plunged to a 15-month low after the Dow struck its lowest level of 2018 on Wednesday.
Oil prices meanwhile dived to fresh 15-month lows, prolonging volatility that has gripped the crude market in recent weeks.
In Europe, London’s benchmark FTSE 100 index slid 0.8% to 6,711.93 points, with losses capped by stronger-than-expected UK retail sales data.
In the eurozone, Frankfurt’s DAX 30 shed 1.4% to 10,611.10 and the Paris CAC 40 slumped 1.8% to 4,692.46 points at the close yesterday. Both are near lows for the year.
The euro, meanwhile, hit a six-week high at $1.1486.
On the corporate front, shares in Airbus plunged nearly 10% after French daily newspaper Le Monde said the European aircraft maker could face fines of several billion dollars under a US corruption probe, before recovering somewhat to end the day down 4.4%.
The Federal Reserve on Wednesday raised US interest rates for the fourth time this year – as expected. But markets reacted badly after chairman Jerome Powell said the bank would not shift course on reducing its balance sheet.
Investors had hoped for a less aggressive approach amid concern that global growth is slowing, while Powell played down the impact of recent market turmoil on the US economy.
“Traders are worried the US central bank will press ahead with monetary tightening plans against a softer economic backdrop,” said market analyst David Madden at CMC markets UK.
Markets “think the Fed has completely misjudged the situation and now it’s just a matter of trying to find an exit while you can”, said Kyle Rodda, analyst at IG Group in Melbourne.
“We’re probably entering a stage now where markets have got it (in) their head that we’re preparing for quite sustained downside going into 2019.”
The Fed now predicts two interest rate increases next year, down from three, as it trimmed its forecast for US growth and inflation.
“The market overreacted to the Fed, I think,” said Shane Oliver, head of investment strategy at AMP Capital Investors.
“It is moving in a dovish direction and is on track for a pause in the first half of next year. Markets are being driven by fear rather than fundamentals.”
But the spillover from the rate hike continued to rattle investors, deepening concern over global growth prospects which are already facing headwinds from Trump’s trade war with Beijing, a slowing Chinese economy, and potential turmoil from Britain quitting the European Union.
Oil prices meanwhile tumbled, with Brent striking $54.64 per barrel, the lowest level since September 2017.
Crude reversed strong gains won a day earlier on concerns about growth and oversupplies of US oil, and tracking equity losses.
A smaller than expected fall in US crude stockpiles added to supply glut fears triggered earlier this week by forecasts of increasing shale oil production.
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