In currency markets, the yuan fell to its lowest level in a year and a half against the dollar. It recovered some of its losses in the afternoon to settle at $6.71 per dollar.
The Dow fell more than 1,100 points on Thursday and the S&P 500 lost 3.7%, erasing Wednesday’s gains as investors worried about the impact of rising U.S. interest rates and the risk of a recession.
Investors in Asia were also jittery following the latest comments from China’s top leadership on its efforts to stem the spread of the coronavirus.
President Xi Jinping said governments at all levels must “resolutely” adhere to the country’s zero epidemic policy. He made the remarks at a meeting on Thursday with members of the Politburo Standing Committee, China’s top policy-making body.
Government officials at all levels must “resolutely oppose any words and deeds that distort, question and deny China’s epidemic prevention and control policies,” Xi said.
“This could dampen some hopes for a Covid-19 policy shift that suggests the economic recovery will be long and uneven,” Yeap Jun Rong, market strategist at financial services firm IG Group, wrote on Friday.
— Nicole Goodkind contributed to this report.