The Dow Jones industrial average plunged 1,033 points Thursday, its second-worst drop in history, extending its losses in the recent selloff to more than 10% and putting it officially into correction territory.
The stock market finished the day sharply higher, but only after another session of wild price swings.
The Standard & Poor's 500 stock market, a broader market gauge that is a core holding in 401 (k) plans, also fell into correction terrritory.
Asian stocks are coming under heavy selling pressure, with benchmark indexes in China, Hong Kong, Japan and South Korea losing 2-5 percent, as the downtrend in oil prices added to worries over higher US bond yields.
The S&P 500 fell more almost 40 points to 2,541, and the Nasdaq tanked more than 100 points after coming out of the gate up 1.5 percent from the previous day.
Overnight the Dow Jones index rose 2.3 per cent, the technology-heavy Nasdaq gained 2.1 per cent and the S&P 500 index advanced by 1.7 per cent.
The 3 percent pullback Thursday across USA indexes is something that did not happen in all of 2017. The Dow Jones and S P 500 accumulate a 10% fall from last maximum marked on January 26, which puts m technically in correction zone.
The market began falling in the first few minutes of trading, and the pace of the declines worsened as the day wore on. "As quickly as the market fell, it recovered much of the ground it had lost as investors remembered the economy and corporate earnings remain strong", he added.
U.S. stocks began to wobble last Friday after a healthy United States labor market report sparked a spike in bond yields and fears of rising inflation. South Korea's Kospi also rose at its opening, and was trading up 0.5 percent at 2,467.50 in morning trading.
The S&P 500 posted no new 52-week highs and 32 new lows; the Nasdaq Composite recorded 24 new highs and 113 new lows. The March copper contract was down one cent to US$3.08 a pound.
The ferocity of the selling has caught investors off guard.
The yield on benchmark 10-year US Treasuries, which tends to be the driver of global borrowing costs, was hovering at 2.85 percent, set to end the week little changed since hitting a near a four-year high of 2.885 percent Monday. That's also a big change: The market has been stable in the previous year because every time it inched lower, investors swooped in looking for bargains and soon sent them higher again.
The S&P 500 ended down 3.8 percent and the Dow ended down 4.2 percent. The last market correction ended nearly two years ago. Natural gas gave up 1 cent to $2.70 per 1,000 cubic feet. It's 10.2% drop since its January 26 record high is its biggest since a 14.2% decline ending in February 2016. Stocks over the long term create more wealth than fixed-income bonds, but they are more volatile and have more risk.
Among the biggest fallers on Tuesday was Tokyo's Nikkei 225 stock average, which ended 4.7 per cent lower at 21,610.24, having earlier been down a massive 7 per cent.
In currency trading, the dollar fell to 109.32 yen from 109.54 yen late Tuesday. The euro fell to $1.2355 from $1.2399.
Several Dow members lost more than 5 per cent, including American Express and Home Depot.
About 10.5 billion shares changed hands in USA exchanges, well above the 8.2 billion daily average over the last 20 sessions.