Wall Street stumbled as worries about bad loans resurfaced following the bankruptcies of auto-related firms First Brands and Tricolor Holdings. Regional banks like Zions Bancorp and Western Alliance saw sharp declines, while Jefferies also tumbled due to its exposure to First Brands.

Meanwhile, early optimism from Taiwan Semiconductor's strong earnings faded as the chipmaker slipped 1.6% after hitting a record intraday high. Despite reporting surging profits and boosting its revenue forecast, the overall market mood dimmed further when the Philadelphia Fed's manufacturing index plunged to -12.8 in October, signaling a steep contraction after last month's surprise rebound.

Banking stocks substantially moved downwards, dragging the KBW Bank Index down by 3.6%. Brokerage stocks were significantly weak, as reflected by the 1.9 loss posted by the NYSE Arca Broker/Dealer Index. Airline, energy and retail stocks too came under pressure as the day progressed while gold stocks continue to turn in a strong performance as the price of precious metal surged to new record highs.

Asia-Pacific stocks moved mostly higher. Japan's Nikkei 225 Index jumped by 1.3% while Australia's S&P/ASX 200 Index advanced by 0.9%. The major European markets also moved to the upside over the course of the session. The French CAC 40 Index surged by 1.4%, the German DAX Index rose by 0.4% and the U.K.'s FTSE 100 Index inched up by 0.1%.

In the bond market, treasuries moved notably higher amid the weakness that emerged on Wall Street. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, slid 7 bps to 3.97%, closing below 4% for the first time since early April.

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