Stock prices plunged around the world today as the turmoil in Russia left traders wondering when the wild sell-off might end.
The Dow industrials extended its losses today after Wall Street faltered in a bid to bounce back from Thursday's 357-point plunge, and markets skidded in Asia and Europe.
Tokyo blue chips dived to a 12-year low, Hong Kong's key index fell 1.2 percent despite heavy buying by the government, and European stocks, which had been rebounding after opening sharply lower, faltered late in the session.
"The drops are so large. It's not just fundamentals driving this, people are scared," said Robert Allen Feldman, chief economist at Morgan Stanley (Japan) Ltd.
The Dow Jones industrials turned lower today after early gains. The Dow, at one point up as much as 78.53, was down 70.03 to 8,095.96 at 3 p.m.
The Dow Jones industrial average tumbled 357.36 points Thursday -- or 4.2 percent -- as the deepening crisis in Russia and doubts about Japan's handling of its recession jolted markets.
The steep decline fueled negative sentiment around the world.
European markets opened with a tumble and attempted a comeback with a powerful rebound in the afternoon before retreating. London's Financial Times-Stock Exchange 100-share index finished with a loss of 2.2 percent.
In Moscow, Russia's largest stock exchange closed up 5.6 percent, which represented a gain of less than 4 points at its depressed levels. Trading was light.
The panicky selling was set off by Russia's economic troubles. The Russian government struggled today to find a way out of its mess, while opposition leaders were clamoring for the removal of President Boris Yeltsin.
Yeltsin returned to the Kremlin today for a series of highly visible meetings to demonstrate he is still in charge amid opponents' calls for his resignation and a reversal of free-market reforms.
Also today, Yeltsin fired two prominent economic reformers -- Boris Nemtsov and Anatoly Chubais -- and vowed to serve out his full term.
Acting Prime Minister Viktor Chernomyrdin accepted a package of Soviet-era economic measures, which parliamentary leaders proposed as a condition for confirming his appointment. The leaders called a special session of the State Duma for Monday to consider the confirmation.
With the ruble in free fall and share prices weak, Chernomyrdin has come under considerable Western pressure not to reverse Russia's post-Soviet push toward a more open, market-based economy.
But the Communist-dominated lower house of parliament has demanded concessions in return for backing Chernomyrdin.
"An awful lot of uncertainties are still out there," said George Hodgson, a European stock strategist at ABN AMRO Hoare Govett in London.
Hodgson said investors may have been overlooking some positive factors: Global economic troubles could make lower interest rates more likely, and some share prices may have plunged to levels where they had become a bargain.
"It doesn't look particularly good, but I don't think we are too far away from the bottom in most European share markets," said Gareth Evans, European equities strategist at Nikko Europe.
Japanese Finance Minister Kiichi Miyazawa used his regularly scheduled news conference today to urge investors to remain calm. "The most important and basic thing is to not panic," he said.
But as trading began, Tokyo stocks plunged again, and by the end of the day they had fallen to their lowest level in 12 years. Even the dollar -- normally sought as a safety net in times of crisis -- tumbled against the Japanese yen.
Japan's Nikkei stock index closed at 13,915.63 points, down 498.16 points, or 3.46 percent, from Thursday. It was the Nikkei's lowest level since March 1986.
Stock markets in Hong Kong and Singapore also continued their plunge with Singapore breaking through an important barrier for the first time in more than a decade.
In Hong Kong, the Hang Seng Index closed down 93.23 points, or 1.2 percent lower, at 7,829.74.
Trading volume reached an all-time record high of 79 billion Hong Kong dollars ($10.13 billion U.S.), and traders estimated that government buying accounted for more than 80 percent of the trading volume.
For two weeks, the Hong Kong government has been propping up the local stock and stock futures markets in a bid to punish speculators, whom officials say have been selling Hong Kong dollars to drive up interest rates and weaken the stock market.
Market participants said the government may have used more than 10 percent of its reserves in the battle.
The Russian turmoil has added to a year's worth of worries over Asia's financial crisis. As many countries, including Japan, have edged toward or fallen into recession, profits at a wide range of European and U.S. companies have suffered.
Japan, the world's second-largest economy, has been widely criticized for not doing enough to revive its economy. Its new government is now deadlocked in a dispute with the opposition over how to revive the nation's troubled banking sector.
The insecurity that this infighting is causing among Japanese citizens and investors was evident today in Tokyo.
In Moscow, Russian shares fell by 1.25 percent, a drop that was modest compared to recent heavy losses. Other Eastern European markets were hit much harder.
Spreading financial pressure appeared to claim a new victim in Canada.
The Bank of Canada, faced with a Canadian dollar at its weakest levels in more than a century, resorted to extreme measures by raising its key rate by a full percentage point to 6.0 percent.