A pedestrian wearing a mask walks past an electronic board showing Japan’s Nikkei average (top) and the graph of its recent fluctuations outside a brokerage in Tokyo, August 17, 2015.
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The Stoxx 600 slid 0.8 percent to 370.56 at 9:02 a.m.in London, after earlier declining as much as 1.6 percent.
The Nikkei share average fell 3.0 percent to 19,435.83, the lowest closing level since May 8.
Over the past few months, Chinese stocks have recorded big losses after a series of disappointing economic data raised concerns over the economic outlook.
The Thai baht weakened to a fresh six-year low of 35.70 against the dollar from 35.54 a day before, as the deadly bombing in Bangkok threatens Thailand’s crucial tourism industry. The dollar extended its losses against the yen as the Nikkei stock index plunged almost 3 percent, dampening risk-taking sentiment and bolstering demand for the Japanese unit, perceived as a relatively safe asset, dealers said.
The broad-based S&P 500 dropped 2.11 per cent while the tech-rich Nasdaq slumped 2.82 per cent.
The data could be key to the Federal Reserve’s timeline for raising interest rates.
Aso said Japan welcomes the move if it was part of Beijing’s efforts to make its currency system a market-based one.
The dollar index against a basket of currencies held firm after three days of gains to stand at 96.953.
“The emerging markets really got slammed overnight and that quickly spread to the rest of the world”, said J.J. Kinahan, chief strategist at TD Ameritrade. The euro was at $1.1251-1251, up from $1.1122-1123, and at ¥138.27-28, up from ¥137.95-97.
The yuan’s decline against the U.S. dollar has had a limited direct impact on the value of the yen.
Commodity prices remained under pressure from worries about growth slowing in China.
Exporters were also among the losing issues as they rely on a weak yen to boost their competitiveness in overseas markets and to ensure profits are augmented on favorable exchange rates when repatriated.
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Brent oil futures fell 0.4 per cent to US$48.55 per barrel, edging closer to a six-month intraday low of US$48.24 touched last week.
