Stocks set to plunge to begin the new year

The Dow is on track to start 2019 on Wednesday with a 425-point slide. S&P 500 futures dropped 1.5%, while the Nasdaq futures tumbled more than 2%. Tech stocks like Microsoft (MSFT), Advanced Micro Devices (AMD) and Apple (AAPL) are under significant pressure.

The selling started overseas, with Asian and European markets careening lower following the release of another weak economic report out of China. New data revealed that China's manufacturing sector contracted in December, an unsettling development for the world's second-largest economy. It is this second time this week that data has indicated China's huge manufacturing sector is shrinking.

"It is looking increasingly likely that the Chinese economy may come under greater downward pressure," said Zhengsheng Zhong, director of macroeconomic analysis at research firm CEBM Group, in a statement.

The ugly factory data only reinforces the economic slowdown fears at the heart of the Wall Street meltdown.

Hong Kong's Hang Seng closed 2.8% lower. The Shanghai Composite fell 1.2% and Australia's ASX dropped 1.6%. Japan's markets were closed for a public holiday.

In Europe, the UK's FTSE was down 1%, while France's CAC slipped 1.3% and Germany's DAX traded flat.

Global growth fears continue to rock commodities. US oil prices dropped another 1% to $45 a barrel on Wednesday. Copper edged 0.3% lower.

Despite a wild rebound during the last few days of the year, 2018 was the worst year for US stocks since the 2008 financial crisis. The S&P 500 nearly plunged into a bear market last week.

CNN Business' Daniel Shane contributed to this report.

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