Global markets plummet
Stocks began their nose dive in Asia, where investors found little comfort from Washington's approval on Friday of a $700 billion bank rescue plan. Doubts over the degree to which the plan could help thaw frozen lending markets and recapitalize banks caused financial stocks to plummet and drag down major indexes.
European shares then shot lower on the open, with some suffering the heaviest losses in their history. More bank bailouts over the weekend underscored the fact that Europe has now moved into the eye of the credit crisis storm with European policymakers so far unwilling to come up with a common rescue plan.
Later in the day, Latin America stock markets joined the global bloodletting, while oil prices also fell below $90 a barrel on expectations that world economic growth will suffer and hurt demand for crude.
In the U.S., the Dow Jones industrial average fell below the 10,000 mark for the first time since 2004, closing off 369.88 points, or 3.6 percent, at 9955.50.
Germany's DAX index dropped 7.07 percent to close at 5,387.01, while France's CAC-40 index suffered its worst day since its creation in 1988, dropping 9.04 percent to 3,711.98. The Irish Stock Exchange was among the worst hit in Europe, plummeting 9.6 percent to close at 3,565.
In Russia, where trading was suspended because of excess volatility, the MICEX also suffered its largest one-day drop ever, falling 18.66 percent at 752.00. A separate Russian stock index, the RTS, fell 19.10 percent.
Iceland's exchange opened but was then shut down, as the government rushed to draft a plan to deal with the financial turmoil's impact on its over-leveraged banking sector. Government officials later said it would guarantee all domestic savings deposits, but failed to provide a more comprehensive plan for its banking sector.
As governments came under pressure to calm the public's fear over deposit savings, Germany, Austria and Denmark joined Greece, France and Ireland in making commitment of varying clarity to guarantee all private deposits, while Sweden doubled the amount it would insure.
At the same time, the governments of Germany and Belgium made last-ditch efforts to bail out ailing banks. Germany agreed to a a 50 billion euro ($68 billion) package to bail out Hypo Real Estate, the country's second-biggest commercial property lender, after a rescue plan by private lenders fell apart. In Belgium, the government managed to get French bank BNP Paribas SA to buy a 75 percent stake in troubled lender Fortis NV.
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