Global equities tumbled as hopes of seeing interest rate hikes slow were dashed by 'good news' from the United States (US) economy.
The ISM services PMI index data saw an increased reading at 56.5 points compared to the forecast of 53.5 points while the previous post was at 54.5 points.
The reading was flanked by strong jobs data on Friday that signaled the Uncle Sam's economic growth was in good shape, once again defying expectations to see tightening policy eased.
Drury Capital Chief Executive Bernard Drury commented, this 'good news' of the US economy is bad news for investors and indicates that the Federal Reserve (Fed) will return to its original plan.
The Fed was previously expected to slow down the period of interest rate hikes with President Jerome Powell's dovish tone, but the US economy is seen to still be able to cope with the effects of aggressive tightening policies.
This indirectly pushed down equities with the Dow Jones Industrial down 1.4% at 33,947.10, the S&P 500 down 1.79% at 3,998.84 and the Nasdaq Composite down 1.93% at 11,239.94.
The Asian trading session saw Australia's S&P/ASX 200 fall 0.28% ahead of the Reserve Bank of Australia's (RBA) monetary policy decision which is expected to raise the cash rate by 25 basis points.
Japan's Nikkei 225 index fell 0.23%, Topix fell 0.24%, South Korea's Kospi fell 1%, Kosdaq fell 1.21% and the broader MSCI Asia Pacific gauge plunged 0.45%.
In the meantime, Treasury yields are back on pace with investors starting to weigh the prospect of aggressive rate hikes to curb inflation and the possibility of a recession as outlined by economic analysts.
