Stock market plunge – live updates

• Asian markets plunge on back of euro fears and US losses • World stock markets tumble sharply again, with the FTSE falling 191 points • Dow Jones Industrial Average falls by 512 points in biggest one-day fall since late 2008 • Oil and gold both decline, as investors race for US Treasuries • Read a summary of today’s events 4.13am: With falls in Indonesia and South Korea adding to the turmoil on global markets, here is the latest AP round-up: Asian stock markets tumbled Friday as investors dumped riskier assets amid fears the US is heading back into recession and Europe’s debt crisis is worsening. The sell-off in Asia followed the biggest one-day points decline on Wall Street since the 2008 financial crisis. Japan’s Nikkei 225 stock average slid 3.4% to 9,335.26 and Hong Kong’s Hang Seng shed 4.1% to 20,989.28. Australia’s S&P/ASX 200 was off 4% at 4,107.20, Taiwan’s Taiex sank 4.2% to 7,967.38 and Seoul’s Kospi dropped 2.8% to 1,961.79. Growing fear about the weakening US economy was joined by concern in Europe that the troubled economies of Italy and Spain might need help from the European Union. But some analysts said the sell-off was not a repeat of 2008 when a banking and credit crisis sent markets into a prolonged tailspin. Traders also unloaded stocks before Friday’s release of the US government’s unemployment report for July, which is expected to show weak job growth and perhaps a rise in the unemployment rate, which is 9.2%. 3.14am: AP’s latest figures have Japan’s Nikkei index down 3.4% and Hong Kong’s Hang Seng down 4.4%. 2.54am: Here is the full take from Reuters on the fall on the Tokyo market, with the latest reaction. Japan’s Nikkei stock benchmark tumbled on Friday to its lowest since the immediate aftermath of the 11 March earthquake, hit by sharp falls in the US market as worries over the global economy dominated the mood, offseting a boost from Japan’s currency intervention and monetary easing the previous day. The Dow and the S&P tumbled more than 4% on Thursday and the Nasdaq lost 5% on fears that the United States is staring at another recession and that Europe’s sovereign debt crisis is swallowing two of its largest economies. All the 33 subsectors on the Topix were lower, with mining and securities sectors hit by a heavy sell-off on investor reluctance to hold risky assets. “A heavy sell-off is expected today. Negative factors are coming from overseas markets, so there’s nothing Japan can do to avoid the repercussions,” said Kenichi Hirano, a strategist at Tachibana Securities. The benchmark Nikkei breached immediate support at 9,300, where the index hovered for some time after a slide that followed the March quake. The Nikkei was down 3.6% at 9,312.52 after hitting an intraday low of 9,264.09 soon after the open. The broader Topix fell below the 800-mark for the first time since 17 March, dropping 3.3% to 799.34. Analysts also said that futures-led selling was dragging down the market, while retail investors may pick up some defensive stocks on dips. “But such dip-buying may not have an impact on the overall market as foreigners are likely to be the main sellers,” Hirano said. The market’s recent malaise stems from a number of factors. US economic data has worsened, suggesting slowing growth from an already sluggish pace in the first half. Europe’s sovereign debt crisis has defied remedies and threatens to engulf the large euro-zone economies of Spain and Italy. “The selling isn’t really anything like during a complete collapse, as the volumes aren’t really there. People are tweaking their portfolios, but they’re not really hammering their core positions all that much,” said a trader for a foreign brokerage who did not want to be identified by name. “It’s more of a reaction to what happened in the U.S., risk-off globally.” 2.41am: A flash on Reuters says the Tokyo market has plunged 4%, its lowest since September 2010. Also on the oil markets, US crude falls $1 to $88.85/BBL – its lowest since February. More on both of those stories as details come in. 2.30am: Hi this is Saptarshi Ray, bringing you any significant updates until the morning UK time, including markets in Asia and Pacific regions. Associated Press reports that the Australian stock market has fallen by 4%. Here’s AP’s take from Sydney: The Australian stock market fell sharply Friday as concerns over the US economy and Europe’s debt woes battered stocks across the world. The Australian benchmark S&P/ASX-200 index plunged 168.6 points, or 3.94%, at 4,107.9 shortly after opening. The country’s major banks were hit especially hard, with shares in ANZ falling more than 5%, and Westpac and National Australia Bank down by more than 4%. Australia’s Treasurer Wayne Swan sought to assure investors that Australia’s economy remains robust. “Australians should never forget that our economic credentials are one of the strongest in the developed world and that Australia has a proven track record of dealing with global economic concern,” he told reporters. “We are in the right part of the world at the right time. Growth in Asia-Pacific remains strong.” Australia weathered the global financial crisis better than most developed nations, helped by a 42bn Australian dollar ($44bn) stimulus package and strong demand for the country’s raw materials. 1.07am: My colleague Dominic Rushe says the New Zealand stock exchange fell 2.3% on opening on Friday morning. 1.03am: The Wall Street Journal reports that Bank of New York Mellon is preparing to charge its big depositors for holding their cash . The giant bank, which specializes in handling funds for financial institutions and corporations, will begin assessing a fee next week on customers that have been flooding the bank with dollars, Bank of New York told clients in a note reviewed by The Wall Street Journal. The decision won’t affect individual savers, who already are stuck with near zero interest rates as the Federal Reserve keeps rates low to support a soft economy. But it is a glaring sign that corporate executives, bank leaders and money market fund managers are fleeing from risk and hoarding cash as the recovery threatens to peter out. 11.48pm: Financial experts have told the BBC’s Newsnight how serious they think today’s market turmoil is. Paul Griffiths, global head of Fixed Income for Aberdeen Asset Management, said: We’re very concerned in terms of not only the market reaction but also the way out of here. Frankly we’re on a knife edge. A little too hot, a little too cold and we could be in a double dip [recession]. Peter Schif, chief executive of Euro Pacific Capital, said: The US is actually heading for a more severe recession than the one we think we just emerged from. In fact I think we’re in a depression. And if depression is interrupted by government stimulus it only sows the seeds for the next downturn. The markets are only beginning to come to grips with this. Unless the Fed[eral Reserve] comes in with more quantitative easing and more stimulus the economy is going down. But the problem is that stimulus is weakening the underlying economy. We need a tight Fed. We need the government to cut back on spending. But none of that will happen because politicians don’t want voters to have to take the medicine. Gillian Tett, US managing editor of the Financial Times, said: “Anyone who was looking for a quick recovery was basically living in cloud cuckoo land.” But she added: I wouldn’t lose sight of the fact that although the economies are slowing and sluggish we haven’t fallen off a cliff yet. (…) The economies right now are bumping along the bottom, they’re not off a cliff. But it’s going to be tough going forward. 11.45pm: White House press secretary Jay Carney said he doesn’t have “a specific reaction” to the huge drop on the Dow Jones today: I don’t have a specific reaction to the market. Markets go up and down. There is no question that we have – this economy has faced headwinds this year, a variety of them including the earthquake and tsunami in Japan, the increase in oil prices, energy prices that resulted from the unrest in the Arab world and the situation in Europe, also. So, our focus has to be on the things that we control which is to take the necessary measures. 11.31pm: Here’s a list of the Dow’s 10 worst days since 1900: By % decline: • 19 Oct 1987: 22.6%, or 508 points • 28 Oct 1929: 12.8%, or 38 points • 29 Oct 1929: 11.7%, or 31 points • 6 Nov 1929: 9.9%, or 26 points • 18 Dec 1899: 8.7%, or 6 points • 12 Aug 1932: 8.4%, or 6 points • 14 March 1907: 8.3%, or 7 points • 26 Oct 1987: 8%, or 157 points • 15 Oct 2008: 7.9%, or 733 points • 21 July 1933: 7.8%, or 8 points By points: • 29 Sept 2008: 778 points, or 7% • 15 Oct 2008: 733 points, or 7.9% • 17 Sept 2001: 685 points, or 7.1% • 1 Dec 2008: 680 points, or 7.7% • 9 Oct 2008: 679 points, or 7.3% • 14 April 2000: 618 points, or 5.7% • 27 Oct 1997: 554 points, or 7.2% • 22 Oct 2008: 514 points, or 5.7% • 4 Aug 2011: 513 points, or 4.3% • 31 Aug 1998: 513 points, or 6.4% 11.20pm: Satirical website the Onion offers its usual scabrous take on the financial crisis with an article about the US Federal Reserve chairman Ben Bernanke getting pissed at a bar and lecturing all and sundry “about how absolutely fucked the US economy actually is” . Bernanke, who sources confirmed was “totally sloshed,” arrived at the drinking establishment at approximately 5:30 p.m., ensconced himself upon a bar stool, and consumed several bottles of Miller High Life and a half-dozen shots of whiskey while loudly proclaiming to any patron who would listen that the economic outlook was “pretty goddamned awful if you want the God’s honest truth.” (…) After launching into an extended 45-minute diatribe about shortsighted moves by “those bastards in Congress” that could potentially exacerbate the nation’s already deeply troublesome budget imbalance, the Federal Reserve chairman reportedly bought a round of tequila shots for two customers he had just met who were seated on either side of him, announcing, “I love these guys.” Numerous bar patrons slowly nodded in agreement as Bernanke went on to suggest the United States could pass three or four more stimulus packages and “it wouldn’t even matter.” “You think that’s going to create long-term economic growth, let alone promote job creation?” Bernanke said. “We’re way beyond that, my friend. There are no jobs, okay? There’s nothing. I think that calls for another drink, don’t you?” 11.11pm: My colleague Jill Treanor has sent through these facts about the performance of the Dow Jones indexes today. The Dow Jones Industrial Average : • Down 512.76 points, or 4.31%, to 11383.68 • Down in 10 of the last 11 trading sessions • Down 10.54%, over the 10-day trading period • Biggest points drop since 1 December 2008 • Biggest percentage drop since 10 February 2009 • Lowest close since 9 December 2010 • Dropped 154.96 points, or 1.34%, in the final hour of trading The Dow Jones US Total Stock Market Index : • Down 665.57 points, or 5.05%, or approximately $787bn in market capitalization • Down in eight of the last nine trading sessions • Biggest points drop since 1 December 2008 • Biggest percentage drop since 20 January 2009 • Lowest close since 30 November 2010 10.56pm: Gordon Brown predicts that the leaders of the Eurozone countries will soon be back in crisis talks in an attempt to tackle the worsening financial crisis. In an article for the Huffington Post, the former prime minister writes : European leaders were quick to define last month’s Euro summit of 2011 as the day European leaders seized the moment and faced the crisis down. Instead it will be seen as a huge missed opportunity, the turning point at which history failed to turn. And, in my judgment, the Euro leaders will soon be back in crisis sessions. (…) Over too long a period it has suited European leaders to believe that theirs is a fiscal crisis in the weaker states, and so they have analyzed their problem in just one dimension: profligacy in the periphery demanding tougher and tougher austerity. But Europe’s problems can only be truly understood in three dimensions: not just as a fiscal crisis but as a pan-European banking crisis – which started as, and continues to be, one of massive unfunded bank liabilities – and as a trans-continental crisis of low growth, in part the result of the euro’s deflationary bias. Together, and in lethal combination, these three problems threaten to create a tragic roll call, year after year, of millions of European citizens unnecessarily condemned to unemployment in a wasted decade. Brown sets out his solution to the crisis, contending that “without action along the lines I suggest, no one can assume that Europe’s historic strength is enough to prevent the most punishing of future outcomes.” 10.36pm: This is David Batty – I’m taking over the live blog for the next few hours. You can follow me on Twitter @David_Batty This table shows the Dow today suffered its biggest fall since December 2008 . My colleague Dominic Rushe in New York has sent through this comment by John Prestbo, editor and executive director of Dow Jones Indexes, on today’s market turmoil. The dog days have turned vicious for the market, with The Dow Jones Industrial Average plunging nearly 513 points, or 4%. The question now is, have investors finished lowering their expectations or is there still some way to go? Time will tell, but it’s difficult to envision a sustained rebound without some evidence that the global economy is alive and kicking. 10.23pm: Time for a round-up of events today, before I hand over to my colleague David Batty. • World stock markets have tumbled amid fears that Italy and Spain will be dragged deeper into the euro debt crisis, and that America might be entering a double-dip recession . • The FTSE 100 fell 3.43% , or 191 points, and is expected to lose another 100 points on Friday. • Wall Street suffered its biggest selloff since 2008, with the Dow Jones dropping 512 points • Gold and oil have also fallen sharply. • UK debt remains a safe-haven, with 10-year bond yields falling. 10.15pm: The euro is continuing to lose ground – down below $1.4099 against the US dollar. The single currency has now lost more than two cents against the dollar today….. 10.00pm: Random fact* of the day – the Dow has fallen almost 1000 points since the Smurfs rang the Wall Street opening bell on July 28. That’s from our Smurf Wall Street correspondent Dominic Rushe, who also reports that Chile’s blue-chip Ipsa index ended 3.9% lower Thursday. That’s Chile’s biggest one-day drop since October 2008. * – I use the term loosely 9.39pm: City experts believe the selloff will continue in London on Friday morning. I just spoke to David Jones, chief market strategist at IG Index. They are calling the FTSE 100 index down another 103 points , or almost 2%, to 5290. That forecast may change through the evening, as Asian markets open. As it stands, though, it’s a case of Tin Hats on (as they say at FT Alphaville ). David explained that the Wall Street losses were more severe than City traders has expected when London closed for the day. José Manuel Barroso’s call for Europe to rethink its financial rescue funds had raised fears that Italy and Spain are about to follow Greece and Ireland, he said Once the US debt ceiling was raised, the markets – which can only really focus on one thing at once – turned their attention back to Spain and Italy. Barroso’s letter confirms suspicions that Europe’s political leaders don’t have a grip. 9.25pm: Reuters is reporting that France’s president, Nicolas Sarkozy will speak to Germany’s Angela Merkel, and Spain’s José Luis Rodríguez Zapatero about the “market situation” tomorrow. That’s from a French official. 9.15pm: Bloomberg just came up with a good fact to illustrate the scale of today’s Wall Street selloff — there were 100 sell orders for every single buy order. Scott Black of Delphi Management says that traders have given a “vote of no confidence” in the US debt ceiling agreement agreed last weekend. That deal did too little to address America’s economic woes, he says: We need a pro-growth agenda and we need to get Americans back to work, and we haven’t done that. Alarmingly, Black also reckons there may be more selling to come on Friday: This thing feeds on news…and I wouldn’t be surprised to see another correction. There’s too much fear out there for me to believe we’ll see any catalyst [pushing shares higher]. 9.00pm: The closing bells are ringing on Wall Street (never send to know for whom the bells tolls, etc etc). Unofficially, the Dow plunged by 512 points , down 4.3%, to 11384. That’s the Dow’s worst one-day slide since December 2008, we reckon. The S&P 500 fell by 4.77%, its biggest one-day fall since February 2009. The Nasdaq was the worst performer with a 5.08% loss. We’ll have the official closing data in a few minutes (market authorities need to conduct the closing auction and match up any outstanding orders), so will update those numbers if they change. 8.54pm: Wall Street investors are racing to the exits in the last few minutes of trading. Dow Jones losses just broke through the 500 point mark, a 4.3% plunge on the day…… 11,392 points as I type Closing in 6 minutes…. 8.48pm: There was the whiff of panic in the air again today, our economics editor Larry Elliott writes. Are we heading for Meltdown 2? The familiar stench of panic was back as shares fell heavily, bond yields in Spain and Italy rose and the search for a safe haven sent the price of gold to a new record level. Banks took an especially severe pummelling amid fears that they were exposed to the two big concerns of investors: a break-up in the eurozone and a double-dip recession in the global economy. More here . No mean history buff our Larry, he also points out that Thursday was the 97th anniversary of Britain’s declaration of war on Germany. The stock market didn’t open for business until early the next year. At least London’s traders can get back into the fray on Friday morning. Many may not relish this opportunity, though…. 8.32pm: With less than half an hour to go until Wall Street closes, the sell-off is accelerating. Any hopes that traders might regain a splash of optimism and switch into buying mode are being dashed. The Dow Jones industrial average is now down 443 points, a 3.7% fall, at 11,452 points. The tech-heavy Nasdaq index has lost 4.3%, while the S&P 500 has shed 4.07%. If yesterday’s late rally hadn’t happened, the Dow Jones would be looking at 10 consecutive days of falls. As James Mackintosh wrote in the FT yesterday , that has only happened on seven occasions. 8.22pm: Britain’s sovereign debt is still a safe haven in these times of turmoil. A glance at the yields (interest rates) on 10-year government bonds shows that UK yields have fallen again – that’s a sign that investors are keen to hold the bonds, and prepared to accept a lower rate of return. As I mentioned at 6.18pm , US government debt has also been in demand, despite its own economic problems. Here’s a list of the latest yields on 10-year bonds, showing which have risen or fallen. Germany : 2.3% – 0.107 percentage points USA : 2.46% – 0.15 percentage points UK : 2.67% – 0.074 percentage points France : 3.18% – 0.031 percentage points Belgium : 4.5% + 0.019 percentage points Italy : 6.232% + 0.132 percentage points Spain : 6.312% + 0.038 percentage points Ireland : 10.618% – 0.22 percentage points Portugal : 12.908% – 0.199 percentage points Greece : 15.279% + 0.037 percentage points So, rising yields in the countries most at risk of being dragged into the mire, but falling yields in the traditional ‘safe havens’ (new cliché welcome), and also in those countries which have already been forced out of the international lending markets. 8.02pm: Do you think the crisis means the euro is finished, or can Europe’s leaders hold the single currency together? Either way, do please vote in this poll on Comment Is Free . With over 1,300 votes already in, the “yes it’s doomed” brigade are leading with 55% of the vote. 7.56pm: Chancellor George Osborne is receiving “regular updates” about the crisis in world stock markets, according to the Press Association. This just in from a Treasury spokesman: This is a time of uncertainty in the international economy. Because of our difficult decisions to reduce the deficit and tackle our debts, Britain has been stable during this time. The economy is growing and creating jobs. The global selloff comes at an inconvenient moment for UK politicians, many of whom have just left for their summer holidays. Spain’s prime minister was forced to fly back from his own summer break to co-ordinate its efforts to control the crisis. 7.44pm: The oil price has also fallen today, with the cost of a barrel of Brent crude down by almost 5% as I type at $107.63. That’s a $5.60 swing. US crude is down by a similar amount, to $86 per barrel. On paper, a falling oil price should be good news for almost everyone. Even some of OPEC’s members have been arguing that the oil price was too high. Market speculators will have seen their fingers burned – just have to hope that their losses don’t trigger further panic…. 7.24pm: Bloomberg TV seems to have declared a temporary cessation in hostilities, and is interviewing a distinguished, veteran golfing celebrity (no, I haven’t deduced his identity yet). But trading continues on Wall Street, and the Dow is scraping new depths — now 3.4% lower at 11,491 (a 404 point slide). The theory that traders are coming off the debt ceiling high has been backed up by Bruce McCain, chief investment strategist at Key Private Bank. He told Marketwatch that investors cannot see a way out of the “roller coaster of the relentless onslaught of bad news” The one thing this perhaps does do, it effectively dispels the myth that the U.S. could achieve a self -sustaining recovery all on its own. Longer term, we’re going to have to be a lot more careful monitoring what is going on in Europe and emerging markets. Hard to argue with that. Indeed, it’s slightly alarming to think that Wall Street’s finest are only now waking up to the scale of Europe’s problems. Then again, EU leaders have spent the last couple of years trying to persuade the markets that individual bailouts would solve the problems. 7.13pm: Royal Bank of Scotland will report latest its financial results to the City tomorrow morning (7am sharp), and the latest reports are that the bank will own up to some very hefty losses on its Greek bonds. Mark Kleinman of Sky News is reporting that RBS will write down the value of its Greek government debt exposure by about £840m. That’s rather more than expected, and much more than other banks this week – Société Générale caused a rumpus when it reported a €395m hit on its own Greek bonds. As Kleinman says : What’s also interesting about RBS’s writedown of its Greek sovereign debt exposure is that it’s yet another “sin of the past” (to borrow a favoured phrase of Stephen Hester, RBS’s chief executive) being confronted by the state-backed bank’s management. If investors calculate that Greek losses are going to be deeper than previously thought, that could spark another selloff….. 7.03pm: Even those Britons who don’t own any shares, and don’t even have a pension, have been hit in the pocket by today’s sell-off. Two of the UK’s partially state-owned banks, Lloyds Banking Group and Royal Bank of Scotland , are among the biggest fallers. Lloyds plunged by 10.1% to 35.1p after posting its latest financial results ( a £3.3bn statutory loss , due to the cost of compensating customers who were missold payment protection insurance). Royal Bank of Scotland was little better, down 6% at 30p. My colleague Jill Treanor has calculated that taxpayers are now nursing £28bn of losses on their £65bn stakes in Lloyds and RBS. 6.54pm: Update on the situation on Wall Street — the Dow Jones Industrial Average is currently in negative territory for the year. The Dow’s down by 334 points right now, at 11561, a fall of 2.8%. One interesting theory doing the rounds is that US traders simply got distracted by the soap opera that surrounded the battle to raise America’s debt ceiling. Now they are taking a closer look at the state of the global economy, and that ain’t a pretty picture [on Monday, several countries reported very poor manufacturing data, including the US, China and the UK] Another factor is that the monthly non-farm payroll stats (the best measure of US unemployment) is due out tomorrow. How bad will that be? Analysts are predicting a net gain of 85,000 jobs in July, but these estimates have proved pretty wild of the mark this year. 6.41pm: In Europe, there were two triggers for today’s global selloff (or the “classic capitulation”, as Knight Capital MD Peter Kenny has dubbed it), a stark warning from José Manuel Barroso, the European Commission president, and the monthly press conference from Jean-Claude Trichet, head of the ECB. Barroso’s comments were the most stark, as he called for Europe’s leaders to re-assess the financial stability mechanisms designed to hold the eurozone together. His comments, just a fortnight after a €109bn rescue deal for Greece, were ideally timed to alarm investors. If the head of the EC believes we don’t have enough firepower to protect the eurozone, the theory goes, why should anyone else? Barroso’s comments have gone down particularly badly in Germany “It is not clear how reopening the debate just two weeks after the summit can lead to calming the markets,” a senior official in Berlin told the Financial Times . Trichet was his usual blend of charm and evasiveness, dodging the tougher questions with style. He did admit, though, that “downside risks may have intensified.” There’s a full transcript here . Of course, the ECB has been taking a much more hawkish approach to monetary policy than the Bank of England, raising rates despite the crisis. That now looks like something of a blunder, according to Tim Ohlenburg, senior economist at Centre for Economics and Business Research: The spread of sovereign debt fears to the two large Mediterranean economies may impact ECB monetary policy if it escalates to the point where firms and consumers lose their already shaky confidence and cut back on investment and durable good purchases, respectively. This could potentially derail the Eurozone recovery, causing not only an end to the current tightening cycle but perhaps even a reduction in rates. While hard to imagine just last month when rates were raised and still an unlikely outcome, the probability of falling rates this year is becoming a real possibility. Plenty of reputations have already been blackened by this crisis. If the ECB do indeed have to cut rates, Trichet might join ‘em. 6.25pm: Comparisons with the collapse of Lehman Brothers should not be made lightly — the turmoil of the autumn of 2008 came close to derailing the whole financial system. But traders are certainly looking back to those days. Here’s the views of Will Hedden , sales trader at IG Index: Today traffic has been one-way: sell, sell, and sell. A brief rally on the open was quickly dashed and shares have steadily moved lower throughout the session. Two of the biggest hit sectors are mining and financial – always a big influence on the UK index. Investors have given most UK banks a wide berth for some time now and today’s half year loss from Lloyds Banking Group has done nothing to ignite interest. Of course, it is the bigger problems of European sovereign debt and faltering global economic recoveries that are weighing on markets. Financial markets are still not convinced that politicians have a strategy for dealing with the increased perception of risk around Italy and Spain – and today’s press conference following the ECB rate decision has reinforced this view. Friday sees US non-farm payrolls announced and, with sentiment so beaten up, it would take a surprisingly positive figure to spark any sort of rally that would make a dent in the declines we have seen over recent days. For many traders this week has felt like the start of the banking crisis in 2008, which would go some way to explaining the panic selling we have seen today. 6.18pm: Now here’s an irony. Just days after the debt ceiling debacle brought America close to defaulting, US government debt is in demand. The global selloff has sent investors scurrying to safe havens, and despite America’s huge debt mountain the number one risk-free asset is Treasury bills. The yield on the US ten-year bond has fallen again to just below 2.5% at pixel time. Such ultra-low rates hardly provide value – this is simply about security. And fear. In contrast, the gold price is sliding. It hit a new record high of $1,681.67 per ounce earlier today – but is now $23 per ounce lighter at $1,659. Some analysts have suggested that the real sign of crisis will be when the gold bubble finally bursts – as banks would have to liquidate their bullion reserves to cover other losses. 6.08pm: Today’s drama began very early, when the Bank of Japan moved aggressively to force down the value of the yen . Japan’s currency has been forced steadily higher in recent weeks, bringing significant pain to its exporters. It hit 76.25yen to the dollar this week, forcing the central bank to act. It sold one trillion yen today, which pushed the currency down to 80.25 against the dollar. So some short-term success — after the Swiss Central bank made similar moves yesterday. However, analysts reckon central bankers cannot hold back the tide. Peter Schiff, CEO of Euro Pacific Capital, told Reuters that investors are desperate for safe havens in the current crisis. Japan and Switzerland can do all they want to slow appreciation, but they will not be able to stop it. 6.03pm: Having narrowly avoided nine days of consecutive losses on Wednesday (when it closed 32 points higher ), the Dow Jones industrial average is deep in the red again. At one stage the Dow was down by 360 points. It has staggered back slightly, and is currently 273 points lower at 11622. At current levels, the Dow is just managing to stay in positive territory for 2011. But it’s a grim picture, and another part of the global selloff. As Bloomberg TV put it, “stocks are in a race to the bottom”. Margaret Brennan, Bloomberg reporter, says there is real fear on the Wall Street trading floors: Panic is the simple word to describe the mood today….. 5.55pm: First, the score on the doors. After falling steadily since around noon, the FTSE 100 index closed 191.37 points lower at 5393.14. That’s a plunge of 3.43%. My colleague Nick Fletcher has crunched the numbers to put it into context: At 5393.19, this is the Footsie’s lowest closing level since September 2010. In percentage terms, we’re not seen a larger daily fall since 30 March 2009. And it’s the biggest points decline since 2 March 2009. If all that wasn’t bad enough, the FTSE 100 has now fallen by 11% since April when it peaked at 6082. That puts us into “correction” territory. Today’s losses wipe £50bn off the value of the companies in the FTSE 100. Since the start of this week, the index is 420 points lower – making its constituent companies worth £110bn less. That’s a significant hit to the nation’s investors. 5.50pm: Hello all. It’s been a dreadful day on the London stock market, where the FTSE 100 has just suffered its worst daily fall since March 2009. The Eurozone debt crisis and the increasingly weak-looking global economy, conspired to send shares tumbling across Europe. Across the Atlantic, the selloff is now in full swing on Wall Street. Traders are making frankly scary comparisons with the events of three years ago, when Lehman Brothers Failed. We’ll be here for the next few hours, crunching the numbers, tracking the Dow, and bringing you analysis and comment from a jittery City. Stock markets United States Europe Graeme Wearden David Batty guardian.co.uk

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