European stocks fell in early trade today to break a two-session rally as a stock correction persisted into a sixth week and credit worries refused to go away.
The Irish market fell over 62 points or 0.7 per cent to 8,087.59. The slide was led by leading financials on the back of renewed worries over the credit markets and the fallout in the US subprime mortgage market.
Allied Irish Bank and Anglo-Irish Bank fell 18 and 43 cents respectively.
Among the biggest losers in Europe were BNP Paribas which dropped 1.4 per cent, while UBS shed 0.9 per cent, and Dexia shed 3 per cent.
Earlier, the pan-European FTSEurofirst 300 index was down 0.8 per cent at 1,469.82. The index is down 10.1 per cent since reaching a year high in mid-July.
Meanwhile, Wall Street stocks opened lower today after US Treasury Secretary Henry Paulson said he saw no quick solution to problems in the credit markets, while bonds held early gains.
Mr Paulson, speaking prior to the open of regular US stock exchange trading, also said the global economy is strong and liquidity will return to normal once investors re-price risk.
After the market open, the Federal Reserve said it added $3.75 billion of temporary reserves to the banking system through overnight repurchase agreements.
On Friday, the Fed cut its discount rate in an emergency move aimed at calming jittery markets. Central banks around the world have also been injecting liquidity into the market to ease a credit crunch.
Equity markets have dropped sharply since mid-July, as defaults on risky US subprime mortgage loans hit a number of financial institutions and sparked concerns over the impact on the credit market and the global financial system.