7 news headlines that contributed to the fall in equity markets

Bad news, they say, never comes alone. For global markets, too, this time it has come in groups. A series of bad news appearing simultaneously triggered the fall of markets worldwide. US markets saw the worst day in 18 months with headlines screaming of a possible meltdown.

We look at some of the headlines that caused global markets to panic:

1. Greek Prime Minister Tsipras Resigns, Placing Bailout Funds in Jeopardy: Just when hopes were high that the Greek government might settle down to rehabilitating a broken economy, the country’s prime minister decided to quit and seek re-election. Just hours after taking delivery of $15 billion, the first tranche of $96 billion three year package, Tripras went back to his ways of frustrating the European Union. His resignation gives the opposition three days to form a government, failing which the President of Greek Supreme Court; Vassiliki Thanou will be the caretaker. The problem is Thanou has been a noted critic of the rescue program. We are back to Greek-induced volatility in the market. Over the last few years the Greeks have never failed to disappoint.

2. China province’s debt crisis exposes economic fault-line: A mini debt crisis in northern China is exposing cracks in a financial pillar of the country's economic revival plan: the $430 billion loan-guarantee industry. Loan given to corporates who are unable to pay back due to the slowdown is now coming to the doors of the 8,000 odd guarantee companies that promise to pay the banker in case of a default. But the rate of defaults have risen to such an extent these days that the guarantee companies are now turning defaulters themselves. A third of these are state-backed companies which stand behind more than 60% of China's guaranteed loans. “We see a lot of these companies (guarantee companies) in China, and we worry about the underlying fundamentals,” said Sally Yim, senior credit officer at Moody’s Investor Service in Hong Kong. “You are bound to see more of these defaults.”

3. Markets ride wave of global meltdown fears: Traders around the street are watching a continued collapse of currencies in the emerging world, with some like the Turkish Lira, Thai Baht, Brazil's Real and Malaysian Ringgit all down more 8% in the past month. The worst performer is the Russian Rouble, down 17%.

4. Greenspan warns about bond market bubble: Former Federal Reserve Chairman Alan Greenspan has been sounding the alarm about a bubble that he believes is forming in the bond market. In two television interviews in recent days, Greenspan said interest rates could shoot higher and derail the economy when the bubble bursts. The former Fed chairman says the current situation in the bond market is comparable to what happens in the stock market during an equity bubble. Noting that stock-market bubbles are typically characterized by extreme price-to-earnings ratios, Greenspan said extremely low yields are foretelling a similar tale for bonds.

5. North Korea orders front-line troops into ‘wartime state’ after exchange of fire: North Korean leader Kim Jong Un has ordered front-line military units to enter "a wartime state" after an exchange of fire with South Korea. The two sides traded artillery fire over their heavily fortified border on Thursday afternoon, according to the South Korean Defence Ministry. Two shells came from the North Korean side, the ministry said, and South Korea fired dozens of shells in response.

6. China’s PMI index falls to six year low: The preliminary reading for a key Chinese purchasing managers' index (PMI) fell to a near six-and-a-half-year low of 47.1 in August, below a Reuters forecast of 47.7, underscoring persistent sluggishness in country's vast factory sector. "The Caixin Flash China General Manufacturing PMI for August has fallen further from July's two-year low, indicating that the economy is still in the process of bottoming out," said He Fan, chief economist at Caixin Insight Group.

7. Rupee hits a two-year low against the dollar: Fall in value of rupee has a direct relationship with the market fall. Falling rupee reduces the returns for FIIs who invest in the country. Rupee has touched a new low of 65.89 as outflows by FIIs continue. With China devaluing its currency pressure is building on Indian central bank to keep Indian corporates competitive.