The US markets have closed after a torrid day, capping off the worst week since August 2011.
The S&P 500 was down 2.06% on Friday, held back by poor performances from former favourites Facebook and Amazon.
The benchmark for many index funds has fallen 17.5% since its September high.
The industrial Dow Jones was down 1.81% on Friday and the tech-dominated Nasdaq fell by almost 3% – its worst week since 2008.
Overall, the major US indexes have fallen more than 12% in December.
Investors are spooked by a number of issues, many relating to uncertainty about moves being made by US President Donald Trump.
Mr Trump has threatened a government shutdown if Democrats do not fund his wall on the country's border with Mexico.
Thousands of government employees could be left without pay if a deal is not reached by midnight (5am UK time).
Among other issues contributing to investor uncertainty were the surprise resignation of US defence secretary James Matthis, Mr Trump's move to pull troops from Syria, worries over the US-China trade war and the Federal Reserve's decision to raise interest rates.
Federal Reserve Bank president John Williams said on Friday that, despite the rise, the bank was ready to respond to fears about future rate hikes and "reassess and re-evaluate our views and our policy stance".
"I think we are hearing something important for markets and that is a concern around risks to the economy and potential slowdown," he told CNBC.
Adam Sarhan of 50 Park Investments said: "Clearly the Fed is changing its tone and it's getting a little more dovish following the market reaction this week.
"The Fed is blinking."
Gregori Volokhine of Meeschaert Financial Services said the US economy was in a "fragile environment".
He added: "The extremist position is winning in the Trump administration, not just on trade but on everything."
New US government data released on Friday showed that US growth in the July-September quarter was 3.4%, dragged lower than expected by a large drop in exports.
Hundreds of billions of dollars of goods were hit by tariffs imposed by other countries in response to similar measures imposed by Mr Trump earlier this year.
The retaliation from China has been especially painful, with soybean sales nearly frozen. China is the world's largest importer of soybeans.
The US markets have closed after a torrid day, capping off the worst week since August 2011.
The S&P 500 was down 2.06% on Friday, held back by poor performances from former favourites Facebook and Amazon.
The benchmark for many index funds has fallen 17.5% since its September high.
The industrial Dow Jones was down 1.81% on Friday and the tech-dominated Nasdaq fell by almost 3% – its worst week since 2008.
Overall, the major US indexes have fallen more than 12% in December.
Investors are spooked by a number of issues, many relating to uncertainty about moves being made by US President Donald Trump.
Mr Trump has threatened a government shutdown if Democrats do not fund his wall on the country's border with Mexico.
Thousands of government employees could be left without pay if a deal is not reached by midnight (5am UK time).
Among other issues contributing to investor uncertainty were the surprise resignation of US defence secretary James Matthis, Mr Trump's move to pull troops from Syria, worries over the US-China trade war and the Federal Reserve's decision to raise interest rates.
Federal Reserve Bank president John Williams said on Friday that, despite the rise, the bank was ready to respond to fears about future rate hikes and "reassess and re-evaluate our views and our policy stance".
"I think we are hearing something important for markets and that is a concern around risks to the economy and potential slowdown," he told CNBC.
Adam Sarhan of 50 Park Investments said: "Clearly the Fed is changing its tone and it's getting a little more dovish following the market reaction this week.
"The Fed is blinking."
Gregori Volokhine of Meeschaert Financial Services said the US economy was in a "fragile environment".
He added: "The extremist position is winning in the Trump administration, not just on trade but on everything."
New US government data released on Friday showed that US growth in the July-September quarter was 3.4%, dragged lower than expected by a large drop in exports.
Hundreds of billions of dollars of goods were hit by tariffs imposed by other countries in response to similar measures imposed by Mr Trump earlier this year.
The retaliation from China has been especially painful, with soybean sales nearly frozen. China is the world's largest importer of soybeans.
