The Ftse 100, which marked its biggest weekly loss of the year on Friday, has now fallen for 10 sessions in a row, its longest continuous decline since 2003.
The US Dow Jones Industrial Average tumbled more than 1,000 points in early trading.
However, other traders countered that stock markets were in “oversold” territory and that investors should bet on a rally.
He said that one reason for anxiety spreading to global markets could be that the crisis showed China’s central bank “spectacularly failed” to stimulate the economy – at a time when their huge stimulus is underpinning recovery in Europe and the US. Calling it a market disaster is not an overstatement.
“Here in the UK the Footsie has been decimated in ten days, as fears over global growth have gripped worldwide investors”.
Yesterday’s bloodbath in London wiped a combined £72bn off the value of companies in the FTSE 100.
“Pension funds and private investors alike will be licking their wounds and wondering when the sell-off is going to come to an end”, said Hargreaves Lansdown senior analyst Laith Khalaf.
Concerns about the outlook for China intensified this month after factory output shrank at its fastest pace in nearly six-and-a-half years and the communist government intervened to devalue its currency to boost exports.
China’s cut in benchmark rates and the reserve requirement ratio “may halt the market slide but we suspect the primary motivation is to shore up confidence in the state of the wider economy”, Williams wrote.
Professor Kamel Mellahi, an emerging markets expert at Warwick Business School, said: ‘The market is looking for some strong signs that China has enough ammunition and more importantly it is willing to use it effectively to weather this storm. The Shanghai composite, down heavily in recent weeks, slipped by more than 8% and has now lost all its gains for 2015 – despite attempts by Beijing to arrest the slump.