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iPhone IMAGE: PETE PACHAL/MASHABLE

World stock markets fell on Tuesday as worries over softening demand for the iPhone prompted a tech stock selloff across the world, while the arrest of car boss Carlos Ghosn pulled Nissan and Renault sharply lower.

Meanwhile, the dollar sagged on worries about the U.S. economy after a steep drop in home builder sentiment and oil prices fell half a percent despite OPEC production cuts in what was a brutal day for investors’ risk sentiment.

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News around Apple Inc triggered the latest bout of stock market selling, after the Wall Street Journal reported the consumer tech giant is cutting production for its new iPhones.

This hit world stock markets with the European tech sector sinking 2 percent and hitting its lowest level since February 2017 as stocks supplying chips to Apple suffered, following Asian tech stocks lower.

The selloff was compounded by an auto sector drop led by Nissan and Renault after Ghosn, chairman of both carmakers, was arrested in Japan for alleged financial misconduct.

The European auto sector was not far behind, dropping 1.6 percent, and the broad European STOXX 600 index was down 0.9 percent to a four-week low.

“Most of Europe had a red session yesterday and that has been compounded by the news on Apple and tech stocks overnight, The overall climate is risk off,” said Investec economist Philip Shaw.

“Beyond stocks, the Italian bonds spread (over German bonds) is at its widest in about a month now, and Brexit continues to rumble on – uncertainty is very much hurting risk sentiment,” he added.