Global stock markets plunge on Fed gloom

A fierce sell-off gripped world markets today after a warning by US Federal Reserve boss Janet Yellen over the global economy, while oil fell close to 13-year lows.
New York's Dow Jones Industrial Average followed European exchanges lower, having already dropped the previous session as Yellen also played down the chances of another US interest rate hike any time soon.
The news sparked a renewed sell-off in Asia today, with Hong Kong stocks tumbling as investors played catch-up after a three-day break for the Chinese New Year.
The intense selling spilled over into Europe, with London falling 2.4 per cent, Frankfurt 2.9 per cent, Paris 4.1 per cent and Milan 5.6 per cent.

"The Fed chair inspired a wave of panic late in the American session that has fed through Asia and turned up on Europe's doorstep," Spreadex analyst Connor Campbell told AFP.
He added that "a lack of sufficient dovishness paired with gloomy comments on the global outlook" had reignited investors' recession fears.

In further testimony today, Yellen downplayed the chance of a contraction in the US economy, saying "it's premature to make a judgment" on the impact of market turbulence.
US oil prices dipped close to a near 13-year low underneath USD 27 per barrel, plagued also by chronic oversupply.
Sentiment soured further as Australian mining giant Rio Tinto posted an annual net loss of USD 866 million and blamed the "highly challenging environment" as commodity prices plunge and China's economic slowdown bites.

The dire result compared with a USD 6.53 billion net profit in 2014.
The company also dumped its progressive dividend policy, in which shareholders are given gradually higher payouts.
That sent Rio Tinto's share price falling by 3.4 per cent.
Swiss-based miner Glencore was also high on the fallers board in London after posting a 6.0-per cent drop in fourth-quarter copper output, falling 6.2 per cent.
Back in Asia, Hong Kong stocks slumped almost four per cent to their lowest levels since June 2012.
On the first trading day of the Year of the Monkey, Hong Kong also slid on concerns about riots in the city this week that saw police battle street sellers, injuring several people. Analysts said the clashes could harm tourism.

There were sharp losses on other Asian markets, with Seoul closing almost three percent down and Singapore off 0.8 per cent, while Wellington also sank. However, Sydney rebounded on bargain-buying.