Global stocks tumble after Wall Street drops on worries about the economy

World stocks tumbled Wednesday after Wall Street had its worst day since early August, with heavyweight Nvidia falling 9.5%, leading to a global decline in chip-related stocks.

Frances CAC 40 slipped 0.8% in early trading to 7,513.31, and Germanys DAX lost 0.8% to 18,607.62. Britains FTSE 100 also dropped 0.8% to 8,230.49.

The futures for the S&P 500 were down 0.4% and those for the Dow Jones Industrial Average shed 0.2%.

Japans benchmark Nikkei 225 lost 4.2% and closed at 37,047.61, leading losses in Asia.

Electronics and semiconductor company Tokyo Electron slumped 8.6% on Wednesday.

South Koreas Kospi was down 3.2% to 2,580.80, with tech giant Samsung Electronics dropping 3.5%.

Taiwans Taiex lost 4.5%, dragged down by the heavyweight Taiwan Semiconductor Manufacturing Company, which was 5.4% lower.

Australias S&P/ASX 200 was down 1.9% and ended at 7,950.50 after Wednesday data showed the countrys GDP grew by 1% compared to the second quarter of 2023, slightly above experts forecast. Hong Kongs Hang Seng index declined 1.1% to 17,457.34 and the Shanghai Composite index shed 0.7% to 2,784.28.

Rising oil supply was driving down prices, as Libya moved closer to resolving a conflict over control of the countrys oil revenue that meant its oil production may soon increase.

Benchmark US crude fell 57 cents to $69.77 a barrel. Brent crude, the international standard, lost 75 cents to $73.00 a barrel.

Growing worries about Chinas economy the worlds largest importer of crude oil also amplified doubts about future oil demand, especially after the recent release of weak data, which was dragged down by a real estate slump and weak consumption.

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The S&P 500s heaviest weight, Nvidia, fell 9.5% Tuesday. Its stock has been struggling even after the chip company topped high expectations for its latest profit report.

The subdued performance could bolster criticism that Nvidia and other Big Tech stocks simply soared too high in Wall Streets frenzy around artificial intelligence technology.

The S&P 500 sank 2.1% to give back a chunk of the gains from a three-week winning streak that had carried it to the cusp of its all-time high.

The Dow Jones Industrial Average dropped 626 points, or 1.5%, from its own record set on Friday before Mondays Labor Day holiday.

The Nasdaq composite fell 3.3% as Nvidia and other Big Tech stocks led the way lower.

Treasury yields also stumbled in the bond market after a report showed American manufacturing shrank again in August, sputtering under the weight of high interest rates.

Manufacturing has been contracting for most of the past two years, and its performance for August was worse than economists expected.

Demand remains subdued, as companies show an unwillingness to invest in capital and inventory due to current federal monetary policy and election uncertainty, said Timothy Fiore, chair of the Institute for Supply Managements manufacturing business survey committee.

Other reports due later in the week could show how much help the economy needs, including updates on the number of job openings US employers were advertising at the end of July and how much United States services businesses grew In August.

The weeks highlight will likely arrive Friday, when a report will show how many jobs US employers created during August.

All told, the S&P 500 fell 119.47 points to 5,528.93 on Tuesday. The Dow dropped 626.15 to 40,936.93, and the Nasdaq composite sank 577.33 to 17,136.30.

In the bond market, the yield on the 10-year Treasury fell to 3.84% from 3.91% late Friday. Thats down from 4.70% in late April, a significant move for the bond market.

In currency dealing, the US dollar was trading at 145.17 Japanese yen from 145.47 yen. The euro cost $1.1052, up from $1.1043.