TOKYO (AFP) - Tokyo stocks plunged more than three percent on Thursday following a tumble in New York on worries over turbulence in emerging markets and the US central bank's decision to cut stimulus spending.

The Nikkei-225 index, which soared 2.70 percent on Wednesday, lost 3.22 percent at one point before recouping some of its losses to sit 3.00 percent or 461.93 points down at 14,921.98.

US stocks fell sharply on Wednesday, with the Dow Jones Industrial Average closing down 1.19 percent at 15,738.79.

They opened in the red and dropped further after the US Federal Reserve announced that it will reduce asset purchases by US$10 billion (S$12.7 billion) in February to US$65 billion.