Traders in New York were looking at a sea of red on screens Friday as US stocks tumbled, along with other global indices.
Putting investors off were China woes and now Greece as world stocks are heading for their worst week of the year and, according to BoA Merrill Lynch, share selling has hit a 15-week high of US$8.3 billion in the past week.
The benchmark Dow Jones is down 128 points at 16,866, the Nasdaq lost 30 to 4,848, while the S&P 500 is down 14 to 2,022, with tech stocks taking a pounding again.
It comes after a 358 point slide in the Dow yesterday - the worst performance in 18 months.
In London, the FTSE 100 is down 97 points, or 1.52% at 6,271.
David Madden, at City spread betters IG, said: "China and Greece have been dominating the headlines in recent months, and now they have both taken a nasty turn at the exact same moment, leaving traders terrified as panic selling becomes widespread. Greece is staring into the political abyss and China is cooling off at an alarming rate."
In Greece, Alexis Tsipras has stepped down and called an election in an effort to remove some of the extreme left wing members in the Syriza party, but there is no guarantee he will be re-elected.
Meanwhile, downbeat Chinese manufacturing data showed manufacturers suffered the worst August reading for the Caixin flash manufacturing PMI in six years.
In corporate news, tech giant Apple (NASDAQ:AAPL) dropped 1.86%. along with Microsoft (NASDAQ:MSFT), down 1.14% while Facebook (FB) dropped 3%.
Shares in Hewlett Packard (NYSE:HPQ) fell in pre-market but were up over 3% in morning trade despite it reporting a 13% drop in third-quarter earnings and issueing current-quarter forecasts below market expectations as the world’s second-largest PC seller continues to struggle amid technology shift toward mobile and Cloud computing.
Foot Locker (NYSE:FL) shares eased 0.77% to around US$71 as the company carried the momentum through 2015, turning in a strong set of second quarter numbers, which beat expectations.
Net income in the three months to August 1 was US$119 million, or 84 cents a share, a 29% increase on the same period last year, while total sales increased 3.3%, to US$1.7bn in the three months compared to the second quarter of 2014.
Elsewhere, shares in Salesforce.com (NYSE:CRM), the world's biggest maker of online sales software, nudged almost 3% higher as it lifted its full year revenue guidance again, as it posted decent second quarter numbers.