The Dow Jones Industrial Average plunged more than 800 points, its worst drop in eight months, led by sharp declines in technology stocks.
For stock investors, the recent spike in bond yields may be prompting some uncomfortable deja vu.
The U.S. trade war with China has largely been brushed off by the markets, but the slide shows it may finally be taking a toll.
All 11 sectors in the S&P 500 are lower, with banks and energy stocks the hardest hit.
Tokyo's Nikkei 225 gave up 3.9 percent to 22,591.10 and the Shanghai Composite lost 4.3 percent to 2,607.44. The Russell 2000 dropped 25 points, or 1.6 percent, to 1,550.25.
Stocks have slumped over the last week as a combination of strong economic data and positive commentary from Federal Reserve leaders sent bond yields rocketing higher as investors bet that interest rates will keep rising.
The increase in yields from these bonds - which are parcels of United States government debt - can hurt stocks since they will provide competition for investors' cash.
Some early relief over a tame report on U.S. inflation gave way to renewed selling.
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"Both companies highlighted rising costs, not only input costs but increasing operating expenses [and] marketing expenses", she said.
Insurance companies dropped as Hurricane Michael continued to gather strength and came ashore in Florida bringing winds of up to 155 miles per hour.
Some of the biggest losers were tech companies. But higher interest rates can slow economic growth and erode corporate profits.
The 10-year U.S. Treasury note yield hit 3.214 percent, up from 3.208% a day earlier. Stocks had come close to big drops in the last few days, but each time they recovered some of their losses. "Since the market bottomed in March 2009, it's been more than 10 years of growth stocks leading the way non-stop".
The spread of red ink overseas, though, suggested more turbulence ahead for Wall Street, where a growing list of concerns is sowing unrest for a market that has been on a historic run on the back of strong earnings.
The biggest driver for the market over the last week has been interest rates, which began spurting higher after several encouraging reports on the economy.
Adams said those worries are affecting technology and consumer-focused companies as well even though companies such as Alphabet, Amazon and Facebook have long had very high profit margins. And there is still an overhang from the USA trade dispute with China, which accounts for sizeable portions of some tech companies' revenue. Apple shares fell 1.2 percent.
The Nasdaq composite rose 15 points, or 0.2 percent, to 7,436.
The dollar slipped to 112.17 Japanese yen from 112.27 yen late Wednesday. The British pound rose to $1.3197 from $1.3146.