Asian markets have plummeted amid fears that the financial crisis would prompt a prolonged global downturn.
Asian markets have plummeted amid fears that the financial crisis will prompt a prolonged global downturn.
Japan's main index was almost 10% lower - losing almost 1,000 points to hit its lowest level in more than five years.
Japan's Nikkei index closed down 9.4% - falling 952.58 points to its lowest close since June 2003 - taking losses over the past fortnight to 24%.
The slump followed a huge sell-off on Wall Street which saw the Dow Jones index close more than 500 points down.
The Nikkei closed at 9,203 points. Hong Kong's Hang Seng index was 5.5% lower. Australia's key index lost 5%.
The Nikkei index lost 9.4% - 989 points - at 9,167 while Hong Kong's Hang Seng index was 5.5% lower and Australia's main market lost 5%.
The slump followed a huge sell-off on Wall Street which saw the Dow Jones index close down more than 500 points.
Recent efforts to bolster world credit markets had failed to stem fears that the spreading financial crisis could lead to a global recession, observers said.
Recent efforts to bolster world credit markets had failed to stem fears that the spreading financial crisis could lead to a global recession, observers said.
"Selling seems almost unstoppable because of uncertainty over the crisis," said Kazuki Miyazawa of Daiwa Securities SMBC
"Selling seems almost unstoppable because of uncertainty over the crisis," said Kazuki Miyazawa of Daiwa Securities SMBC
"Investors simply don't find incentives to buy stocks."
"Investors simply don't find incentives to buy stocks."
Action call
Action call
On Tuesday, US stocks hit their lowest levels in five years as investors continued to worry over the strength of the world's banking institutions.
On Tuesday, US stocks hit their lowest levels in five years as investors continued to worry over the strength of the world's banking institutions.
US President George W Bush has called for unified action to combat the world's financial crisis.
US President George W Bush has called for unified action to combat the world's financial crisis.
Australia's decline came despite the central bank's efforts to stem the crisis by cutting its official interest rate by 1% on Tuesday.
Australia's decline came despite the central bank's efforts to stem the crisis by cutting its official interest rate by 1% on Tuesday.
New York's main stock market index, the Dow Jones, rallied briefly on Tuesday before closing down more than 5%. The index has lost nearly 13% of its value in its past five sessions.
New York's main stock market index, the Dow Jones, rallied briefly on Tuesday before closing down more than 5%. The index has lost nearly 13% of its value in its past five sessions.
Tuesday was another grim day for New York Stock Exchange traders
Tuesday was another grim day for New York Stock Exchange traders
Federal Reserve Chairman Ben Bernanke gave financial markets little reassurance when he said the US was tackling a financial crisis "of historic dimensions".
Federal Reserve Chairman Ben Bernanke gave financial markets little reassurance when he said the US was tackling a financial crisis "of historic dimensions".
He signalled that the Fed - which is invoking emergency powers to buy up company's short-term debts - might be prepared to cut interest rates to support the economy.
He signalled that the Fed - which is invoking emergency powers to buy up company's short-term debts - might be prepared to cut interest rates to support the economy.
Mr Bush telephoned the leaders of France, Britain and Italy to discuss ways of tackling the markets turmoil.
Mr Bush telephoned the leaders of France, Britain and Italy to discuss ways of tackling the markets turmoil.
He called for co-ordinated action by leading industrialised countries to tackle the worldwide credit crunch.
He called for co-ordinated action by leading industrialised countries to tackle the worldwide credit crunch.
The International Monetary Fund said losses on loans in the US, and on financial assets based on those loans, were likely to be double the $700bn provided in a rescue package agreed by Congress.
The International Monetary Fund said losses on loans in the US, and on financial assets based on those loans, were likely to be double the $700bn provided in a rescue package agreed by Congress.
London's main FTSE 100 index had earlier rallied ahead of an anticipated announcement of a package to rescue the UK's beleaguered banks.
London's main FTSE 100 index had earlier rallied ahead of an anticipated announcement of a package to rescue the UK's beleaguered banks.
Britain's Finance Minister Alistair Darling is due to make a statement on the crisis before London's financial markets open, a day after shares in British banking giants HBOS and Royal Bank of Scotland shed nearly a third of their value.
Britain's Finance Minister Alistair Darling is due to make a statement on the crisis before London's financial markets open, a day after shares in British banking giants HBOS and Royal Bank of Scotland shed nearly a third of their value.
As depositors grew increasingly anxious their savings were at risk, EU finance ministers agreed to increase the guarantee for customers' bank savings accounts to at least 50,000 euros.
As depositors grew increasingly anxious their savings were at risk, EU finance ministers agreed to increase the guarantee for customers' bank savings accounts to at least 50,000 euros.
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