Stock markets dropped on Thursday on rising concerns about prospects for the global economy, following days of sharp moves in government bonds that hinted at slower growth and inflation than previously expected.

Equities fell first in Asia before the negative mood spread into Europe and then to Wall Street — a move analysts blamed on expectations that US economic growth is about to peak at the same time as signs emerge of a slowdown in China.

The US S&P 500 index was down 1 per cent in afternoon trading in New York, while the technology-focused Nasdaq Composite slipped 0.7 per cent. Both indices had set records in recent days.

In Europe, the continent-wide Stoxx Europe 600 lost 2 per cent after Hong Kong’s Hang Seng index ended its session 2.9 per cent lower. Spain’s Ibex closed down 2.3 per cent and Italy’s FTSE MIB lost 2.6 per cent. The FTSE 100 in the UK was down 1.7 per cent.

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