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Shares tumbled in the US overnight as investors sold out of equities on an increasingly pessimistic outlook over the strength of the global economic recovery. The latest sell-off was prompted by a slump in US consumer confidence and a slowdown in Chinese exports.

The Conference Board ‘Consumer Confidence Index’ slumped to 52.9 from 62.7, against expectations of a fall to 62.

Another measure of volatility, the VIX, jumped 18% to levels seen in late May and early June.

Investors moved their money to the US government’s 10 year bonds, with yields there falling below 3% for the first time since April 2009.

The Dow Jones fell 268.22 points, or 2.65%, to 9,870.30, the S&P 500 sank 33.33 points, or 3.10%, to 1,041.24 and the NASDAQ lost 85.47 points, or 3.85%, to 2,135.18.

Among the banks, Citigroup retreated 5.3%, while Bank of America, American Express, Morgan Stanley and Wells Fargo all retreated between 4% and 5%.

Apple tumbled 4.5% among tech stocks, while rival Microsoft was 4.1% weaker.

Search engines Google and Yahoo! were down 3.8% and 4.7% respectively.

Bookseller Barnes & Noble tumbled 19.1% after posting a bigger than expected loss.

Elsewhere Tesla Motors, a maker of electric cars, traded for the first time on NASDAQ Tuesday. Its shares surged 40.5%.

Ford shares sank 5.3%.

Meanwhile, the bellweather industrial stocks on the Dow index, Boeing and Caterpillar tumbled 6.3% and 5.5% respectively.

NYMEX light crude oil for August delivery fell $2.70 to $75.56 a barrel.

COMEX gold for August delivery gained $4.40 to $1,243 an ounce.

European Markets

European stocks all tumbled on concerns Chinese economic growth was cooling. Losses were heavily felt in commodity stocks, with the major miners all tumbling.

The UK benchmark FTSE 100 lost 157.46, or 3.10% to. 4,914.22. The German DAX gave up 205.19, or 3.33% to 5,952.03, the French CAC40 slumped 143.46, or 4.01% to 3,432.99.

UK banks, Barclays, Royal Bank of Scotland and Lloyds were down 6.3%, 3.9% and 2.9% respectively.

On the continent, BNP Paribas slumped 6.9%, while Deutsche Bank was 3.9% down.

Across other industries, Vodafone shed 2.6% after Credit Suisse cut its outlook for the company to ‘neutral’.

Aussie peers, Rio Tinto and BHP Billiton tumbled 6.4% and 5.8% respectively. Anglo American was 5.6% lower.

BP was 1.7% lower, as it seeks to raise funds to shore up its balance sheet. Royal Dutch Shell was 3.5% lower.

Japanese Markets

Japanese stocks fell for the sixth successive day Tuesday, despite a solid gain in morning trading. As with other international markets, the decline was triggered by concerns over a decline in Chinese economic output, while a stronger yen also hit exporters.

The Nikkei 225 shed 123.27, or 1.27% to 9,570.67.

Among the banks, Mizuho Financial Group, the most heavily traded stock on the Japanese exchange, retreated 1.3%, while rival bank Mitsubishi UFJ lost 1%.

Heavy equipment maker, Hitachi Construction Machinery, shed 2.2%. Investors sold out of that stock as it exports heavily to China.

Canon shed 2.7% and Toshiba Corp fell 1.7%, while Sony edged 0.2% above the line.

Car makers Honda and Nissan gave up 1.9% and 1.3%. Toyota gave 0.6%.

Hong Kong Markets

The Hang Seng lost ground, once again on concerns over Chinese economic strength.

The Hang Seng fell 477.78, or 2.31% to 20,248.90.

Among the banks, heavyweight lender ICBC was 2.6% below the line, while Bank of China was down 2.5%. HSBC was off 2.1%.

Li & Fung, which makes clothes for Australia’s Bonds and Wal-Mart in the US, slumped 4.7%. Footwear maker Yue Yuen Holdings was flat.

As in other parts of the world, commodity stocks were particularly heavily sold. Jiangxi Copper and Yanzhou Coal Mining were down 3.3% and 6.1% respectively.

Cnooc was 3.6% lower, while Petrochina was 2% weaker.

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Market Watch by egoli