European and U.S. stocks stabilized Tuesday, a day after a large sell-off at New York exchanges, but Asian markets fell sharply.
Key stock indexes in London, Paris and Frankfurt closed mixed, but U.S. stocks advanced in mid-day trading.
Asian stocks suffered following Monday's release of weaker-than-expected manufacturing data in the United States.
Tokyo's benchmark Nikkei average ended the day down nearly 4.2 percent -- its lowest mark in nearly three months.
After making strong gains in 2013, the Nikkei has tumbled more than 15 percent since the start of the year.
Japanese Cabinet Secretary Yoshihide Suga said investors are concerned about developments in the U.S., with the world's biggest economy.
"In addition to future concerns with the emerging markets, U.S. economic data announced earlier was seen as weak, meaning that there is now a heightened sense of uncertainty with the U.S. economy as well. Investment money thus fled to less riskier U.S. government debt, and at the same time, there was a move to buying back the yen," he said.
Trading was also lower in South Korea and Hong Kong. Markets in China and Taiwan were closed for a holiday.
Wall Street on Monday had its worst day since June, after new data showed U.S. manufacturing activity slowed sharply in January.
There are also lingering concerns about emerging markets following the U.S. Federal Reserve's decision to further trim its bond-buying stimulus.
The policy, which is on pace to end altogether by the end of the year, was meant to pump more money into the U.S. economy, boost job growth and keep interest rates low.
But as interest rates edge higher, analysts worry investors will pull their money from emerging economies and seek higher returns in the U.S.