Wall Street has seen its worst sell-off since 2009 and Europe markets plunged as worries about a global slowdown and the euro zone debt crisis intensified.
The Dow Jones and Standard & Poor's indexes tumbled more than 4% on Thursday and the Nasdaq lost 5%.
In Europe, share markets dropped for a second day. A key index of blue chip companies from the euro zone dropped more than 3% to a two-year low, while sharemarkets in London, Paris and Frankfurt were also down by more than 3%.
Comments by the European Commission president Jose Manuel Barroso have sparked fears that the euro zone debt crisis may spread to Italy and Spain, and prompted investors to move towards so-called save haven assets.
The European Central Bank signalled it was buying government bonds in response to a deepening European debt crisis.
The Japanese government intervened in currency markets to stem recent gains in the yen, causing the US dollar to strengthen against other currencies, including the New Zealand dollar.