Financial markets in Asia and the US have tumbled on fears that the world’s largest economy could be headed to a recession.

Shares in American chip giant Nvidia slumped by almost 10% as concerns over the economy dampened optimism about the boom in artificial intelligence (AI).

On Wednesday morning, major Asian indexes dropped after major stock indexes in New York fell sharply.

Investors turned more cautious as new data showed US manufacturing activity remains subdued, with the focus now on key jobs figures due on Friday.

In New York on Tuesday, the S&P 500 index closed more than 2% lower, while the technology-heavy Nasdaq fell by over 3%.

On Wednesday, Japan’s Nikkei 225 was down around 3%, South Korea’s Kospi was trading 2% lower and the Hang Seng in Hong Kong dropped by 1.5%.

Major Asian technology firms including Samsung Electronics, SK Hynix and Tokyo Electron were sharply lower.