Global markets plunge as Fed mulls biggest rate rise in decades

US investors fret about possible recession as S&P 500 plummets into bear territory and global markets feel aftershocks

Fears about a possible recession have pounded stock markets around the world amid reports that US Federal Reserve could raise interest rates by as much as 0.75% this week - its biggest single hike in borrowing costs for nearly 30 years.

As Wall Street's benchmark S&P 500 index fell almost 4% on Monday into bear territory, prompting selloffs from Sydney to Shanghai, US central bank policy makers will begin a two-day meeting on Tuesday with expectations mounting that they will lift rates by at least 0.50%.