The U.S. Federal Reserve’s decision Thursday to keep its target rate unchanged spurred a global selloff of stocks in the week's last trading session. Meanwhile government bonds surged as traders sought safe harbor amid concern over a global slowdown.

“There are definitely additional indications of turbulence immediately ahead,” said Robert Hockett, law professor at Cornell University who specializes in monetary law and economics, who pointed to China’s high levels of private debt as a worrying sign from the world’s second-largest economy.

The Dow Jones Industrial Average (INDEXDJX:.DJI) shed 226.95 points, or 1.36 percent, to drop to 16,448. The Standard & Poor's 500 index (INDEXSP:.INX) fell 20.49 points, or 1.01 percent, to 1,968. The Nasdaq composite (INDEXNASDAQ:.IXIC) dropped 44.7 points, or 0.91 percent, to 4,849.

Five of the 10 S&P 500 sectors traded lower, led by financials and telecommunications. Health care and utilities were up.

A selloff in Europe sent the German DAX down 3.51 percent while the Paris CAC40 lost 3.4 percent. Asian markets were more subdued with the Shanghai composite up a slight 0.38, Hong Kong’s Hang Sen up 0.3 percent; Japan’s Nikkei 225 shed nearly 2 percent.

The U.S. dollar dropped to a three week low against major currencies after the Fed decision to keep borrowing costs low, which sent traders toward riskier currencies like the Indian rupee, which had its biggest gain against the greenback in two years.

The U.S. benchmark 10-year Treasury yields fell more than 6 percent as demand for safe-harbor increased. Oil prices traded lower Friday. West Texas Intermediate crude, the benchmark for U.S. oil prices, fell 3.33 percent to $45.34 per barrel for October delivery on the New York Mercantile Exchange. On the London ICE Futures Exchange, Brent crude lost 1.57 percent to $48.31 a barrel.