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Fear grips global stock markets Fear grips global stock markets
(30 minutes later)
Wall Street shares have fallen sharply in opening trading, with the Dow Jones index down 6% at 8,056 points. Wall Street shares fell sharply on the opening in volatile trading, as fears grew of a widespread economic slowdown.
It briefly dipped below the 8,000 points level. The fall in US shares comes as stocks fall around the world. The Dow Jones Industrial Average dipped below 8,000 but then recovered and was down 0.05% at 8,574 points.
Dealers' trading screens across Europe and Asia have all turned red amid rising fears of a global recession. In Europe share prices falls have been much steeper. In London the FTSE 100 share index was down 6.9%, Paris was down 8.4%, and Frankfurt was down 8.9%.
Wall Street has lost more than 20% of its value in ten days and is heading for one of its biggest weekly falls since it was created 112 years ago. Investors increasingly fear a global recession, despite interest rate cuts and cash injections by central banks.
Investors fear a global slowdown, despite interest rate cuts and huge cash injections by central banks. Wall Street has lost more than 20% of its value in the past ten trading days and is heading for one of its biggest weekly falls since the Dow was created 112 years ago.
The FTSE 100 share index was down 8.4% at 3,955 points. It opened 9.8% lower at 3887 points, below the 4,000-point level for the first time in five years. Paris was down 8.4% while Germany was down 8.8%. Finance ministers from the G7 are to meet in Washington later and President Bush is to make an address to the American people.
The Prime Minister, Gordon Brown, has again called on other countries to follow Britain's bank rescue package. As well as the G7 meeting, talks will be held at the International Monetary Fund (IMF) in Washington.
DOW JONES INDUSTRIAL AVERAGE: 10 October 2008*All Times GMT
FTSE 100 INDEX: 10 October 2008*All Times GMTIn Europe the FTSE 100 share index was down 6.9%. It opened 9.8% lower at 3887 points, below the 4,000-point level for the first time in five years. Paris was down 8.4% while Germany was down 8.9%.
Bank bail-out
The Prime Minister, Gordon Brown, again called on other countries to follow Britain's bank rescue package.
"What we need now is for other countries to be doing similar things," he told the BBC news channel."What we need now is for other countries to be doing similar things," he told the BBC news channel.
He said he was confident the bail-out would eventually help stabilise the economy.He said he was confident the bail-out would eventually help stabilise the economy.
"Everybody depends on banks. We're trying to get the banks to do what they've traditionally done, to get the flow of money to businesses, to help people with their mortgages, to make sure people's savings are safe," he said."Everybody depends on banks. We're trying to get the banks to do what they've traditionally done, to get the flow of money to businesses, to help people with their mortgages, to make sure people's savings are safe," he said.
FTSE 100 INDEX: 10 October 2008*All Times GMTDAX INDEX: 10 October 2008*All Times GMT In other major developments:
    class="bulletList">
  • The British pound tumbled to a five-year low against the US dollar to trade at $1.6902 at one point, but recovered slightly later. It also fell against the euro to 1.245 euros
  • Tokyo's shares plunged 24% during the week, double their weekly fall during the 1987 market crash
  • Oil prices plummeted to a one-year low in European trading, with the price of Brent crude oil dropping to $77.2 a barrel at one stage.
  • The three-month rate at which banks lend dollars to each other - known as Libor - has risen to 4.8%
  • Moscow and Jakarta stock markets remain suspended because of excessive volatility
  • The Vienna stock market fell 10% on re-opening after trading was suspended on Friday morning.
In other major developments:
    class="bulletList">
  • The British pound tumbled to a five-year low against the US dollar to trade at $1.6902 at one point, but recovered slightly later. It also fell against the euro to 1.245 euros
  • Tokyo's shares plunged 24% during the week, double their weekly fall during the 1987 market crash
  • Oil prices plummeted to a one-year low in European trading, with the price of Brent crude oil dropping to $77.2 a barrel at one stage.
  • The three-month rate at which banks lend dollars to each other - known as Libor - has risen to 4.8%
  • Finance ministers from the G7 are to meet in Washington later and President Bush is to make an address to the American people.
  • Moscow and Jakarta stock markets remain suspended because of excessive volatility
  • The Vienna stock market fell 10% on re-opening after trading was suspended on Friday morning.
 Despite concerted government action, investors are increasingly fearful the financial crisis will prompt a global recession. The underlying illness remains in the system - as manifested in the record amounts banks were charging each other yesterday for lending to each other Robert PestonBBC Business Editor class="" href="http://www.bbc.co.uk/blogs/thereporters/robertpeston/">Robert Peston's blog class="" href="either url here">Interbank lending frozen
Despite concerted government action, investors are increasingly fearful the financial crisis will prompt a global recession. The underlying illness remains in the system - as manifested in the record amounts banks were charging each other yesterday for lending to each other Robert PestonBBC Business Editor Robert Peston's blog
"It's a banking problem, it's a credit crisis problem and it's a complete loss of confidence worldwide," said David Buik of BGC Partners in London."It's a banking problem, it's a credit crisis problem and it's a complete loss of confidence worldwide," said David Buik of BGC Partners in London.
The BBC's business editor Robert Peston said markets were worried about Friday's auction of insurance claims on the debts of the collapsed US investment bank, Lehman Brothers.The BBC's business editor Robert Peston said markets were worried about Friday's auction of insurance claims on the debts of the collapsed US investment bank, Lehman Brothers.
This could not come at a worse time for bank shares, said our correspondent.This could not come at a worse time for bank shares, said our correspondent.
'Unstoppable selling' Trading suspended
Heavy falls were seen across Asia's markets as a climate of fear took hold on Friday. Earlier there were heavy falls across Asia's markets as a climate of fear took hold on Friday.
In Japan, the Nikkei index slumped in its biggest one-day fall since the 1987 stock market crash. In Japan, the Nikkei index slumped in its biggest one-day drop since the 1987 stock market crash.
The crisis also claimed its first Japanese financial institution, with the insurance company Yamato Life going bankrupt.The crisis also claimed its first Japanese financial institution, with the insurance company Yamato Life going bankrupt.
"Selling is unstoppable in New York and Tokyo," said Yutaka Miura, senior strategist at Shinko Securities in Tokyo.
"Investors were gripped by fear."
Tokyo dealers faced their worst day's trading since the 1987 crashElsewhere in Asia was a similar story.Tokyo dealers faced their worst day's trading since the 1987 crashElsewhere in Asia was a similar story.
In India, the Mumbai market plunged 6.5% in early trading. Shortly afterwards, India's central bank said it would make an additional $12.8bn (£7.5bn) available for the money markets.In India, the Mumbai market plunged 6.5% in early trading. Shortly afterwards, India's central bank said it would make an additional $12.8bn (£7.5bn) available for the money markets.
Crisis talks Australian shares closed down 8.3% while Hong Kong's benchmark Hang Seng index slumped to a three-year low.
Australian shares closed down 8.3%, Hong Kong's benchmark Hang Seng index slumped to a three-year low while in the Philippines, share prices closed down more 8.3%. In Indonesia, plans to re-open the stock market were suspended, trading had been halted for two days earlier this week.
In Indonesia, plans to re-open the stock market were suspended in order to prevent what the president of the exchange called "deeper panic". Trading was halted for two days earlier this week.
Finance ministers from the G7 leading industrial countries are set to meet in Washington to discuss the crisis.
US President George W Bush is due to make an address to the American people later in the day.
As well as the G7 meeting, talks will be held at the International Monetary Fund (IMF) in Washington.
The IMF has said it is ready to lend to countries hit by the global credit crunch, using an emergency lending procedure first used in the 1990s Asian crisis. It has about $200bn immediately available to lend but can tap other sources.
What kind of effect is the fall in share prices having on your life? Are you worried about your pension or investments? What questions would you like to put to the experts? Send us your questions using the form below.What kind of effect is the fall in share prices having on your life? Are you worried about your pension or investments? What questions would you like to put to the experts? Send us your questions using the form below.
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