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| Shares slump as rescue bid fails | Shares slump as rescue bid fails |
| (1 day later) | |
| US and European shares have plummeted after a $700bn (£380bn) US bail-out was rejected and a slew of bad news emerged from the troubled banking sector. | US and European shares have plummeted after a $700bn (£380bn) US bail-out was rejected and a slew of bad news emerged from the troubled banking sector. |
| The Dow Jones index lost 770 points - 6.9% - its biggest one-day point drop yet as Congress surprised observers by not backing the rescue plan. | The Dow Jones index lost 770 points - 6.9% - its biggest one-day point drop yet as Congress surprised observers by not backing the rescue plan. |
| Meanwhile the Nasdaq index fell 9.1% and London's FTSE 100 index lost 5.3%. | Meanwhile the Nasdaq index fell 9.1% and London's FTSE 100 index lost 5.3%. |
| Confidence had already been smashed by the rescue of US bank Wachovia and Bradford and Bingley's nationalisation. | Confidence had already been smashed by the rescue of US bank Wachovia and Bradford and Bingley's nationalisation. |
| The Dow Jones closed at 10,365.4 points after the bail-out result threw efforts to calm the US financial crisis into disarray. The tech-heavy Nasdaq ended down 200 points at 1,983.7. | The Dow Jones closed at 10,365.4 points after the bail-out result threw efforts to calm the US financial crisis into disarray. The tech-heavy Nasdaq ended down 200 points at 1,983.7. |
| Unrest | Unrest |
| The plan's failure meant nobody truly knew how the financial sector would recover, with credit markets remaining almost frozen as banks remain reluctant to lend to other banks, analysts said. | The plan's failure meant nobody truly knew how the financial sector would recover, with credit markets remaining almost frozen as banks remain reluctant to lend to other banks, analysts said. |
| They added until there was certainty over the future of the bail-out bill, there would be tremendous unrest - with sharp falls expected when markets open in Asia and later in Europe. | They added until there was certainty over the future of the bail-out bill, there would be tremendous unrest - with sharp falls expected when markets open in Asia and later in Europe. |
| Meanwhile the dollar fell against other major currencies. | Meanwhile the dollar fell against other major currencies. |
| And concern that a worsening economy would reduce energy demand saw the price of US light, sweet crude slump by $10.52 a barrel to $96.37. | And concern that a worsening economy would reduce energy demand saw the price of US light, sweet crude slump by $10.52 a barrel to $96.37. |
| Dramatic events | Dramatic events |
| The fall on the FTSE 100, which closed at 4,818.8 points was its biggest one-day drop since January, with Germany and France's main markets seeing falls of 5% and 4.2% respectively. | The fall on the FTSE 100, which closed at 4,818.8 points was its biggest one-day drop since January, with Germany and France's main markets seeing falls of 5% and 4.2% respectively. |
| The market moves came on another eventful day of global financial turmoil, which BBC Business Editor Robert Peston described as the "worst" since the credit crunch began. | The market moves came on another eventful day of global financial turmoil, which BBC Business Editor Robert Peston described as the "worst" since the credit crunch began. |
Developments include:
| Developments include:
|
| London's FTSE 100 index closed at 4,818.77 points - with several banking shares losing more than 10% of their value. | London's FTSE 100 index closed at 4,818.77 points - with several banking shares losing more than 10% of their value. |
| Germany's Dax index ended 4.2% lower while France's Cac 40 slid 5%. | Germany's Dax index ended 4.2% lower while France's Cac 40 slid 5%. |
| What is required is an overhaul of the whole economic system - a widespread fix Ann PettiforAdvocacy International Why the bail-out would not have worked | What is required is an overhaul of the whole economic system - a widespread fix Ann PettiforAdvocacy International Why the bail-out would not have worked |
| 'Contagious effect' | 'Contagious effect' |
| Analysts said that the market downturn was not surprising after the latest fall-out from the banking sector. | Analysts said that the market downturn was not surprising after the latest fall-out from the banking sector. |
| "There is a contagious effect," said Darren Winder, head of macro and strategy research at Cazenove. | "There is a contagious effect," said Darren Winder, head of macro and strategy research at Cazenove. |
| "The implications of a fallout from (the credit crunch) are far-reaching, there are dozens of quoted banks in Europe, so it would seem unlikely that they would all be unaffected by this." | "The implications of a fallout from (the credit crunch) are far-reaching, there are dozens of quoted banks in Europe, so it would seem unlikely that they would all be unaffected by this." |
| The lack of support in the House of Representatives for the plan to bail out Wall Street came despite calls by President Bush for lawmakers to back it. | |
| The bill had been designed to end the credit crunch - and send a strong signal to the markets. | The bill had been designed to end the credit crunch - and send a strong signal to the markets. |