London (AFP) - Global stock markets slumped further Friday as doubts built over whether the US Federal Reserve would cut interest rates next month and persistent fears of a tech bubble.

Crude prices rallied as analysts cited risks to Russian oil flows due to Ukrainian strikes and US sanctions.

On Wall Street, the Dow shed 1.1 percent to stand at 46,929.78 points some 25 minutes into the session, while the tech-heavy Nasdaq was off 1.9 percent at 22,436.79 points – having ended two percent down Thursday.

The S&P 500 fell almost 1.5 percent – losses mirrored on major European and Asian indices.

London struggled after UK government bonds and the pound slid following reports that finance minister Rachel Reeves has scrapped plans to hike income tax in her budget speech this month.

Analysts said the reports heightened concerns about UK public finances.

“After an extraordinary run that began in April, the tech sector has finally started to wobble, with valuations looking overstretched in recent weeks,” said Fawad Razaqzada, market analyst for StoneX.

“It wouldn’t be surprising if markets stayed a bit jumpy for a while yet, though it’s still premature to call the top of this cycle,” he added.

- ‘volatile week’ -

“It’s certainly been a volatile week… with relief over the end of the (US government) shutdown vying with concerns over AI valuations and whether the Fed will cut rates again,” said Jim Reid, managing director at Deutsche Bank.

Traders trimmed bets on a December rate cut after several Fed officials voiced concerns about cutting borrowing costs while inflation remained stubbornly high.

For much of the year, equities have been boosted by optimism that rates would come down, and the Fed has delivered at its past two meetings.

But comments from Fed boss Jerome Powell last month that a December repeat was not “a foregone conclusion” sowed the seeds of doubt.

Investors also awaited the release of economic data that had been held up by the record US government shutdown, with jobs and inflation the main focus, even though some statistics are expected to be incomplete.

The dimmer outlook for rates compounded worries that the tech sector may be overpriced after an AI-fuelled surge that sent markets to record highs this year.

“The tech-sector rout from Wall Street spilled across the globe,” on Friday, noted Joshua Mahony, chief market analyst at Scope Markets.

Oil prices rallied some two percent, rebounding days after the commodity tumbled on OPEC’s monthly report which forecast an oversupply in the third quarter.

The International Energy Agency on Thursday flagged risks to Russian output caused by US sanctions imposed last month, including on the country’s top two producers.

- Key figures at around 1445 GMT -

New York - Dow: DOWN 1.1 percent at 46,929.78 points

New York - S&P 500: DOWN 1.3 percent at 6,646.91

New York - Nasdaq Composite: DOWN 1.9 percent at 22,436.79

London - FTSE 100: DOWN 1.6 percent at 9,657.52 points

Paris - CAC 40: DOWN 1.4 percent at 8,120.54

Frankfurt - DAX: DOWN 1.3 percent at 23,676.79

Tokyo - Nikkei 225: DOWN 1.8 percent at 50,376.53 (close)

Hong Kong - Hang Seng Index: DOWN 1.9 percent at 26,572.46 (close)

Shanghai - Composite: DOWN 1.0 percent at 3,990.49 (close)

Dollar/yen: DOWN at 154.16 yen from 154.53 yen on Thursday

Euro/dollar: UNCHANGED at $1.1634 from $1.1634

Pound/dollar: DOWN at $1.3160 from $1.3189

Euro/pound: UP at 88.41 pence from 88.21 pence

West Texas Intermediate: UP 2.2 percent at $59.96 per barrel

Brent North Sea Crude: UP 1.9 percent at $64.16 per barrel