A disappointing US labor market report released recently has sparked fears of a potential recession, leading to a significant market downturn.

On the previous Friday, the U.S. Dow Jones Industrial Average fell by over 610 points, with the S&P 500 and Nasdaq also experiencing notable losses.

The Australian stock market mirrored this trend, with the S&P/ASX200 index dropping by 3.7% on Monday, resulting in a loss of over $100 billion in market value.

This sell-off in Australia reflects a broader global trend, particularly across Asian markets, where equities and risk assets have declined significantly.

The Australian Securities Exchange faced relentless selling pressure, with Japan's benchmark stock index suffering a dramatic 7% drop.

Cryptocurrency markets were also heavily impacted, with Bitcoin plummeting nearly 16% to around $52,673.

As the Reserve Bank of Australia prepares for its upcoming meeting, it is expected to maintain current interest rates, with potential cuts not anticipated until early 2025.

Investor sentiment has shifted from 'risk-on' to 'risk-off', indicating a sudden loss of confidence in the market amid these developments.

Market analysts attribute some of the weakness in Asian markets, including Australia, to the unwinding of the yen carry trade, which has exacerbated volatility.

The market's negative response to bad news signals growing concerns about an impending recession, as investors increasingly seek safer assets.

Overall, the Australian share market has experienced its largest two-day sell-off in over two years, driven by ongoing global recession fears.