 "Japanese stocks slump to six-month lows on Wall St retreat")
European bourses were destined to share the pain with the DAX predicted to open down as much as 1.1% and the FTSE 0.8%, according to spread betters.
The S&P 500 E-Mini contract was holding steady, at least for now.
What was increasingly looking like a major portfolio shift from momentum plays in US technology and biotechnology stocks was having a knock-on effect across all regions and sectors, pressuring even defensive shares.
Momentum investing involves buying stocks that are already trending higher, often taking their price/earnings ratios into the stratosphere. When the momentum turns it can do so viciously as investors rush to the exits at the same time.
Japan, in particular, was vulnerable both to the dive in tech stocks and to the strength of the yen, which crimps exports and corporate profits. The Nikkei gapped lower right from the off to reach a trough of 13,885.
Dealers suspected the authorities were working behind the scenes to get public pension funds to buy and stop the rot, but with only limited success.
The index ended 2.4% lower at 13,960, with the breach of chart support at 14,200 and the close under 14,000 both body blows from a technical perspective.
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Tech bellwether Softbank felt the heat with a drop of 3.8% to its lowest in over two months. Clothing giant Fast Retailing shed almost 8% after it cut its profit forecast when investors were already nervous about the impact of this month's sales tax hike.
Markets across Asia were spooked by the scale of the losses, with Korea down 0.6% and Australia 0.9%. MSCI's broadest index of Asia-Pacific shares outside Japan lost 0.8%.
Even the MSCI emerging markets index eased back a little, a day after reaching its highest for the year so far. The emerging sector has been on a tear in the last couple of weeks as funds cut back exposure to developed markets.
BONDS BENEFIT
The retreat followed a brutal day on Wall Street, where the Nasdaq suffered its worst single-day drop since late 2011. The tech-heavy index sank 3.1%, while the Nasdaq biotechnology index plunged 5.6%.
The selling rippled through the broader market pulling the Dow down 1.62% and the S&P 500 2%.
Investors were in part taking profits as the US corporate reporting season started amid expectations that results would not be stellar enough to support the high valuations of some stocks. JPMorgan and Wells Fargo both report later Friday.
With stocks out of favour, government bonds were set to benefit and yields on the benchmark 10-year US Treasury note fell to their lowest since February 27 at 2.62%. They were last at 2.656% in Asia.
Even Greece managed a triumphant return to the bond market just two years after its default placed it at the centre of the euro zone debt crisis.
The afterglow from the Greek deal combined with the latest drop in US yields helped the euro higher on the dollar. On Friday, the single currency was up at $1.3892 having rallied two full cents over the past four sessions.
The dollar recouped a little lost ground on the yen to 101.77, though that was still off a high of 102.14 on Thursday. So far, speculative sellers have shied away from major chart support around 101.20 which has held for much of the past three months.
Against a basket of currencies, the dollar was a fraction firmer at 79.412, after hitting a three-week low of 79.330 on Thursday.
The fall in the dollar helped gold edge up to $1,320.32 an ounce, and further away from the month's trough at $1,277.29.
Oil prices remained soft in the wake of disappointing trade data from China out on Thursday and the prospect of increased supply. Brent crude eased 23 cents to $107.23 a barrel, while US crude was quoted down 32 cents at $103.08.