Most Asian markets fell Tuesday following a sharp sell-off in New York and Europe that was fuelled by fears a coronavirus resurgence will force fresh economically painful containment measures.
Traders have also given up almost any hope for a new US stimulus package being passed before next Tuesday's election, with Democrats and Republicans blaming each other, though there are still expectations a new deal will be agreed afterwards.
The need for a big-spending rescue for hard-hit Americans is being highlighted by a big jump in new infections across the country that observers fear will deal a blow to an already shaky economic recovery.
Data this week is expected to show record US growth in the third quarter thanks to a multi-trillion-dollar stimulus agreed earlier this year alongside huge Federal Reserve support.
However, that follows a record contraction in the second quarter, while economists have tipped the economy to shrink this year.
"The second and third wave spread of Covid-19 is possibly triggering a point of no return for some industries as the economic damage borders on irreversible," said Axi strategist Stephen Innes. "The Covid-19 induced downward spiral continues accelerating."
With an eye on next week's vote, he added: "We should expect price action to remain choppy in the days ahead, with investors very reluctant to put on any significant risk ahead of what promises to be a headline heavy week or two."
Stimulus 'urgently needed'
David Kelly, at JP Morgan Asset Management, added: "A stimulus bill in the lame-duck session is urgently needed and could be supplemented by a more comprehensive measure when the new Congress meets, early in 2021."
On Wall Street, the Dow suffered its worst day since early September, dropping more than two percent while the S&P 500 and Nasdaq also suffered sharp losses. That came after Frankfurt was hammered more than three percent, with Paris and London shedding more than one percent.
And the selling continued in Asia, though the retreat was not as painful.
Hong Kong shed 0.6 percent, while Sydney dropped 1.7%, while Wellington and Manila also lost more than one percent. Singapore, Jakarta, Bangkok and Taipei were also in the red, while Tokyo was marginally lower.
Mumbai and Shanghai ended with gains.
Seoul gave up 0.6% despite data showing the South Korean economy grew more than expected in the third quarter thanks to a big jump in exports.
"The optimism of the summer has been replaced by the pessimism that administrations are desperately trying to get a handle on the situation," said CMC Markets analyst David Madden.
"In the last few months, the services and manufacturing data from the major eurozone economies have broadly painted a picture of an economic recovery that is running out of steam. In light of the latest measures taken by governments in continental Europe, it is likely that economic activity will go down another gear."
Chinese e-payments giant Ant Group was planning to stop taking orders for the Hong Kong leg of its $34 billion mega-IPO owing to it being massively subscribed, Bloomberg News reported.
The dual listing in Hong Kong and Shanghai is tipped to be the biggest in history and would value the firm at about $315 billion, bigger than Wall Street financial titans Goldman Sachs and JP Morgan Chase. Its shares are slated to debut on November 5.