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European stocks fell sharply in morning trading as a result of concerns over a trade war and rising US bond yields fueled global investor worries.
In London, the FTSE 100 index of major UK stocks fell by more than 1.7% to 7,020.
Asian markets fell to their lowest level in 19 months, after US stocks suffered their worst loss in eight months.
Christine Lagarde, director of the IMF, said stock valuations were "extremely high".
In Paris, the CAC 40 equity index was down 1.6% at 5,122 points, while the Dax Frankfurt index was down nearly 1.5%.
The FTSE 100 and CAC 40 have dropped to their lowest levels since April, while the Dax is at its lowest since early 2017.
Asian markets followed US stocks, which fell on Wednesday.
Japan's benchmark, the Nikkei 225, lost 3.9%, its largest daily decline since March. In China, the Shanghai Composite fell 5.2%, its lowest level since 2014.
Why are the markets down?
by Dominic O. Connell, BBC Today Business Presenter
For a year, stock market experts predict a sharp fall. It was an obvious prediction; most markets are reaching or reaching all-time highs, especially in America, where investors have benefited from the longest period of market growth.
What goes up must come down – the only question was timing. Over the last year, there have been even more signs of a so-called "merger" phase of a bull market, where equity price increases are concentrated in some very large companies. Apple, Facebook, Google and Amazon are behind most of the rise in US markets in the last 12 months.
The trigger for the latest fall was a sudden leak of US government debt.
Investors began selling US government bonds – the IOUs they issued to fill the gap – thinking they were no longer a valuable investment. This in turn caused a crisis of realism on the stock market.
The concerns over a trade war have added to this new atmosphere of caution and it should be noted that yesterday, several large US companies warned that tariffs on imports from China were beginning to harm their business. .
A peculiarity of this particular market decline; Traditional safe havens, such as gold and, perverse, US government debt, have hardly changed in price. This suggests that investors are unsure of what will happen – a big crash or another rally – and are happy to sit on the money.
Trump's attacks 'crazy' Fed
US markets performed better than expected this year, bouncing back from the turbulence of the beginning of the year to set new records over the summer.
But the Federal Reserve raises its interest rates. The latest increase will take place last month and further increases are likely to occur.
Last month, the Fed dropped the description of its "accommodative" policy, reflecting the idea that the economy is strong enough not to need the same stimulus as that which She received after the financial crisis.
The prospect of a reduction in stimulus measures from the United States has been compounded by a trade war between the world's two largest economies – which, according to the IMF, could hurt growth.
US President Donald Trump has been particularly critical of the Fed's rate hike, breaking with the American tradition that presidents respect independence. from the central bank.
"The Fed is making a mistake," he told reporters on Wednesday. "I think the Fed has gone crazy."
Correction "late"
However, analyst Michael Hewson of CMC Markets said it was "too simplistic to blame the Federal Reserve" for market turmoil.
"There are a number of factors," he told the BBC. "Clearly, the slowdown in growth has raised concerns – the IMF has downgraded its global growth forecast for the global economy, citing emerging market concerns," he said.
Mr. Hewson added that trade tensions between China and the United States had weighed on Asian markets for most of this year, while trade tensions between the United States and the European Union had affected European markets. Concern over the political situation in Italy has also added to the nervousness of the market.
"This is a long overdue correction, motivated by the US markets, which have outperformed most of the past two or three years," he added.
Simon French, Chief Economist at Panmure Gordon, told the BBC that "what was really interesting was the speed with which the sales went on," adding that there has been a trend in markets years followed by sharp declines.
He added, "When the US president says very unpleasant things about the Federal Reserve … you do not necessarily expect that in the United States."
"This made investors say:" Given these gains, we cash some, [and] take money from the table "."
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