Concerns about the U.S. Federal Reserve taking back some of its monetary stimulus has increased risks for financial markets. Now, jitters about political unrest in the Middle East and renewed concerns about some of the euro zone's smaller economies could ensure high risk stays there for a while.
European stocks fell more than a percent on Wednesday morning, Asian equities traded lower, U.S. oil prices jumped more than 2 percent to above $100 a barrel and the Japanese yen fell to a fresh five-week low at about 100.85 per dollar.
(Read More: US Oil Jumps Above $100 a Barrel)
Strategists say that just as markets showed signs of stabilizing at the start of the week from concerns about an unwinding of U.S. monetary stimulus, political turmoil in Egypt, a political crisis in Portugal and renewed concerns about Greece provide investors with additional reasons to stay away from risky assets.
In a reminder that the euro debt crisis is not over yet, euro zone officials said on Tuesday that Greece has three days to reassure its lenders it can deliver the conditions of its international bailout in order to receive the next installment of aid.