HONG KONG (AFP) - Resources firms led by mining giant Glencore headed a sell-off in Asian markets on Tuesday (Sept 29) following painful losses across Europe and New York as fears about the impact of China's slowing growth burst back into view.

Tokyo tumbled 3.58 per cent, Hong Kong lost 3.59 per cent by lunch, Sydney shed 2.75 per cent and Shanghai was 1.84 per cent lower.

Singapore shares sank on opening with the Straits Times Index down 1.46 per cent at 2,751.26 as of 1:20 pm.

In a fierce rush to safety the yen and gold rallied and higher risk emerging market currencies took another hit ahead of the release of key US jobs data that could play a big part in the Federal Reserve's decision on when to hike interest rates.

Trading floors around the planet have witnessed extreme volatility since mid-August, when China devalued its yuan currency, fanning fears about the state of the world's number two economy and crucial driver of global growth.

"The slowdown in China is spreading to other Asian economies, Brazil and Australia, and weakness in emerging countries could echo throughout the overall world economy," Toshihiko Matsuno, chief strategist at SMBC Friend Securities, told Bloomberg News.

"We still don't know when market fears will end about China's slowdown, and because of this investors are turning to cash and safe assets."

China has been suffering a painful slowdown in growth for several months and is expected to see its worst performance this year in a quarter of a century.

Last week already-weak confidence was rattled by news that a gauge of factory activity in the country came in at its lowest level for six-and-a-half years in September.

The latest panic comes after China said its key industrial companies saw profits fall 8.8 per cent in August - hit by last month's shock devaluation, weak demand and plunging stocks.

With China's demand for resources waning and prices sitting at multi-year lows, commodities-linked firms took a hit.

The hardest hit was Glencore, which lost 26 per cent in the morning in Hong Kong. The losses followed a near 30 per cent plunge in its London-listed arm after online brokerage Investec warned about the impact of soft commodity prices on the group.

"We know all their businesses including agricultural, energy, or mining, all are in trouble," securities analyst, Jackson Wong told AFP.

"They are in a very tough situation that how they are going to survive in the next few years with the slow economy in China, that's the worry that investors have," Mr Wong, associate director at Simsen Financial Group, said.

Other resources firms also sank. In Sydney BHP Billiton plunged nearly six per cent and Rio Tinto shed just over four per cent, while Origin Energy plunged 8.37 per cent and Santos gave up almost eight per cent.

Noble Group, the commodities trader criticized over its accounting methods, retreated 12.4 per cent in Singapore, paring an earlier slump of almost 15 per cent to a seven-year low.

Markets in New York and Europe were equally sideswiped on Monday. The Dow plunged 1.92 per cent, the S&P 500 lost 2.57 per cent and the Nasdaq tumbled 3.04 per cent. Earlier in the day London, Frankfurt and Paris all lost more than two per cent.

Bullion, another go-to safe haven, added 0.10 per cent to US$1,132.72.

Foreign exchange dealers also fled to assets considered safe in times of turmoil. The US dollar fell to 119.51 yen from 119.93 yen Monday in New York, while the euro slipped to 134.60 yen against 134.83 yen.

The greenback extended gains on other regional currencies.

The resources-linked Australian dollar was down 0.5 per cent against the US dollar at 69.54 cents, around six-year lows.

The South Korean won fell 0.48 per cent against the US unit, the Thai baht shed 0.27 per cent and Indonesia's rupiah was 0.31 per cent lower.

Malaysia's ringgit was 1.15 per cent lower, the Taiwan dollar shed 0.53 per cent and the Singapore dollar eased 0.27 per cent.

The dollar is earning extra cache as investors prepare for an expected rate hike by the end of the year, with Friday's jobs data in focus. A strong reading will put fresh pressure on the Fed to move, putting pressure on emerging economies as investors withdraw their cash to seek better returns in the US.

Oil prices extended losses after losing around 2.5 per cent on Monday.

US benchmark West Texas Intermediate eased 0.09 per cent to US$44.39 and Brent was marginally lower at US$47.33.