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New York - Global stock markets fell on Tuesday as anxiety about slowing growth, weak German economic data and a potentially poor earnings season led to heavy selling.
Frankfurt's benchmark DAX 30 index slumped 2.6% as dire German factory orders sparked fresh questions about the health of the eurozone's biggest economy.
France's CAC 40 index shed 2.2%, Britain's FTSE 100 dropped 1.2% in value and the FTSE-Mib in Milan fell 3% as Italian banking shares dove.
"A three-week low in the price of oil goes someway to explaining deteriorating market sentiment," said CMC Markets analyst Jasper Lawler.
The declines also came as International Monetary Fund chief Christine Lagarde said in a speech in Frankfurt that although the global economy wasn't in crisis, the recovery is still "too slow" and "too fragile" in the face of growing risks from a slowdown in China and subdued growth in developing economies.
Lagarde hinted the IMF will cut its current 2016 global growth forecast of 3.4% next week when it publishes a fresh outlook ahead of its spring meeting with the World Bank in Washington.
"Her downbeat comments are probably to soften up markets for downgrades in IMF forecasts next week," said Lawler.
US stocks were in the red the entire session, with many prominent banking and technology shares lower. The S&P 500 ended the day down 1%.
Analysts are not expecting great things from the US earnings season, which kicks off in earnest next week. Companies in the S&P 500 are expected to see a 4.2% drop in earnings for the first-quarter, according to S&P Capital IQ.
"Investors are in a wait-and-see mode as we prepare for the earnings season to evaluate whether the recovery we've seen from the February lows should be justified or whether stocks have gotten ahead of themselves," said David Levy, portfolio manager at Republic Wealth Advisors.
The benchmark Nikkei index in Tokyo dropped 2.4% as the yen continued to strengthen against the dollar.
"The risk of a strong yen is still there and coupled with overseas factors like falling oil, it's quite hard to become positive," said Norihiro Fujito, a strategist at Mitsubishi UFJ Morgan Stanley Securities.
"We're likely to keep trading at these depressed levels."
European oil companies were in retreat as crude prices remained under pressure. British-listed BP and Royal Dutch Shell and France's Total all lost about 2%.
European carmakers also tumbled. French giants Peugeot and Renault lost 6.5% and 4.9%, respectively, while Germans Daimler and Volkswagen shed 3.5% and 4%.
Dublin-based Allergan plummeted 14.8% as the US Treasury announced new rules to discourage mergers between US and foreign businesses designed to sharply lower the US company's tax bill. Dow member Pfizer added 2.1%.
Baker Hughes tumbled 5.1% on reports that the US Justice Department will sue to block its takeover by fellow oil-services giant Halliburton on antitrust grounds. Halliburton advanced 1.2%.
Dow member Disney lost 1.7% after the surprise resignation of chief operating officer Thomas Staggs, who had been the leading candidate to replace chief executive Bob Iger. Topeka Capital Markets called the news "truly stunning" and predicted Iger's contract would be extended to assuage investors.
