After U.S. stock markets experienced their largest losses since February 2009 on Thursday, the Nikkei index in Japan closed 3.7 percent down on Friday. The Japanese market, which closed at 2 a.m. ET, can serve as an early indicator of the day's trading in global markets.
The Dow Jones Industrial Average fell 512 points on Thursday, amidst fears of a deepening European debt crisis and a bleak U.S. jobs report due to be released on Friday morning by the Labor Department.
Friday's trading marked a 5-month low for the Nikkei, its worst performance since the March 11 earthquake and tsunami that hit Japan, according to reports.
"This is not only about some bad data from the U.S. economy -- look how Italian and Spanish CDS spreads have widened overnight -- that's what's really pushing the market down," Takashi Aoki, a senior fund manager at Mizuho Asset Management, told Reuters.
In other trading, the Hang Seng index in Hong Kong closed down 4.3 percent, the worst slump since September 2010, the Wall Street Journal reports.