European stock markets have opened lower amid fears the financial crisis will cause a prolonged global downturn.
European stock markets have opened lower amid fears the financial crisis will cause a prolonged global downturn.
In London the FTSE 100 index was down 1.8% shortly after opening, while in France the Cac 40 was down 4%.
In London the FTSE 100 index was down 3.3% shortly after opening, while in France the Cac 40 was down 4.5%.
Earlier in Asia, Japan's Nikkei closed down 952.58 points, or 9.4%, at 9,203, its lowest close since June 2003.
Earlier in Asia, Japan's Nikkei closed down 952.58 points, or 9.4%, at 9,203, its lowest finish since June 2003.
Elsewhere, Hong Kong's Hang Seng index was 5.5% lower, Australia's key index was down 5%, and India's main share index had fallen 8% at one point.
Elsewhere, Hong Kong's Hang Seng index was 5.5% lower, Australia's key index was down 5%, and India's main share index had fallen 8% at one point.
The slump followed a huge sell-off on Wall Street which saw the Dow Jones index close down more than 500 points.
'Unstoppable' selling
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.
The slump followed a huge sell-off on Wall Street which saw the Dow Jones index close Tuesday down more than 500 points.
The European falls came despite the UK government announcing details of a rescue package for the banking system worth at least £50bn ($88bn).
The plan to buy a stake in at least eight banks and building societies came in the wake of a slump in the value of many banking shares.
Recent efforts to bolster world credit markets have failed to stem fears that the spreading financial crisis could lead to a global recession, observers say.
"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.
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