US stocks have plunged today, with the Dow and S&P 500 briefly falling over 3% as a global rout worsened due to falling oil prices and worries about China.

Selling was heaviest in oil shares, financials and tech stocks, which sent the Nasdaq tumbling more than 4% before it recovered slightly.

Around 5.45pm Irish time the Dow Jones Industrial Average was at 15,898, down 480 points (2.94%).

The broad-based S&P 500 fell 57.42 (2.99%) to 1,864, while the tech-rich Nasdaq Composite Index plummeted 174.93 (3.79%) to 4,440.

US oil prices skidded more than 5% to $29.20 a barrel in New York, a fresh 12-year low.

Analysts also cited a 3.6% drop in the Shanghai stock index, raising further worries about the world's second-biggest economy.

Other factors included lacklustre US retail sales in December and disappointing corporate earnings.

Major losers included Citigroup (-6.9%), Intel (-9.1%), Disney (-4.8%), Chevron (-3.9%) and Twitter (-6.2%).

European shares at lowest since December 2014

Meanwhile, European shares ended the day at their lowest since mid-December 2014, hit by losses in commodity-related stocks as BHP Billiton announced a major write down and oil fell below $30 a barrel.

Some investors said stocks were deeply oversold and flagged hopes of more central bank intervention to help reverse the trend after three straight weeks of losses.

BHP Billiton shed 6.4%, the top faller on the pan-European FTSEurofirst 300, after saying it would write down the value of its US shale assets by $7.2bn.

That cemented expectations the company will be forced to cut its dividend for the first time in more than 25 years.