A sell-off in the riskier parts of the market deepened as the United Kingdom's plan to boost its economy fueled concerns about heightened inflation, which could lead to higher interest rates, exacerbating fears of a global recession.

The S&P 500 briefly breached its June closing low before paring losses across equity trading desks. Chartists looking for signs of where the rout might be easing had identified that as a possible area of support. However, the lack of full-fledged capitulation may indicate that the drawdown is not over. Goldman Sachs Group reduced its target price for US stocks, warning that a significant upward shift in interest rate expectations will weigh on valuations.

As risk off sentiment gained traction, Wall Street's "fear gauge" surged to a three-month high, with the CBOE volatility index briefly exceeding 30. According to Datatrek Research, the US equity benchmark has hit near-term lows when the VIX was above that level throughout the year. Trading volume in the S&P 500 was higher than the previous month's average, according to data compiled by a newswire.