The rout in global financial markets that has spared few asset classes extended into Thursday, with Asian stocks plunging across the board, led by a 6 percent fall in Japan's benchmark Nikkei 225 in the morning session.
With investors dumping assets ranging from bonds, currencies to equities, there appears to be a lack of hope among investors that central bank policies can generate real economic recovery, said strategists.
"We are seeing the first signs of a lack of confidence in the ability of central banks to control the interest rates, to stimulate inflation, and real GDP [gross domestic product] growth rates," Viktor Shvets, head of strategy research, Asia, at Macquarie, told CNBC Asia's "Squawk Box" on Thursday.
"We had all sorts of QEs [quantitative easing] of various forms for the last five years and if you look at inflation all around the world it's falling - whether it's the U.S., euro zone, Asia Pacific, emerging markets. I think that's a problem," he added.
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Japan's Nikkei 225 plunged as much as 6.2 percent, reentering bear territory - which is defined as a 20 percent decline from a recent high. Australia's S&P/ASX 200, meantime, fell over 1 percent, hitting a five-and-a-half month low.
This came on the heels of a sell-off in European and U.S. stocks on Wednesday, with the Dow posting its first three-day losing streak for the year amid concerns over the Federal Reserve scaling back its bond buying program.
Uncertainty over the timing of the Fed's next moves, also, weighed on the U.S. dollar which fell to a near four month low against a basket of major currencies on Thursday.
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"The storm clouds are building: the Dow has just suffered its first three-day losing streak for the year, the Chicago VIX [volatility] index has climbed further; Europe is sliding off its highs; China is slowing down faster than expected, and the BOJ [Bank of Japan] is holding the line on additional stimulus action," wrote Evan Lucas, market strategist at trading firm IG Markets.