Markets worldwide plunged today after economic fears and a slump in China's stock market worried investors.
The Dow Jones Industrial Average in the United States fell by 144.8 points to 12487.5 in early trading, while the FTSE 100 Index dived by more than 2 per cent.
London's top flight index fell by as much as 160.6 points, hitting 6274.1 at one point, as tensions over Iran also caused alarm.
Experts put most of the falls down to the slump in China, where investors worried that the government may try to cool economic growth by raising interest rates or reduce more of the money available for lending.
Hong Kong's Hang Seng Index dived by almost 2 per cent, while the Shanghai Composite index plunged 8.8 per cent on profit-taking by institutional investors.
Meanwhile, negative comments from former US Federal Reserve chief Alan Greenspan contributed to the stock price decreases after he warned the world's biggest economy may fall into recession by the end of the year, saying the US budget deficit remained a major hurdle for economic growth.
London shares also reacted badly to rising oil prices, which soared past 60 US dollars a barrel earlier today as the UN Security Council met in London to discuss tightening sanctions in Iran, Opec's number-two oil producer.