Australian shares set to plunge amid global slump, NZ falls

Australian shares are set to open sharply lower on Thursday, following steep falls in global equity markets, as growing fears of a looming recession in the world's largest economy is expected to dent local sentiment.

Yields on two-year US Treasury notes rose above the benchmark 10-year yield for the first time since June 2007, a closely-watched metric for recession signals.

The local share price index futures fell 2.1% to 6,400, a 195.9-point discount to the underlying S&P/ASX 200 index close. The benchmark closed 0.4% higher on Wednesday.

New Zealand's benchmark S&P/NZX 50 index was down 1.2% to 10,722.13 in early trade.