Stock markets across the world have fallen sharply this afternoon as more profit warnings and fears of war in Iraq rattled fragile confidence.
In New York the Dow Jones index fell 120 points or 1.5 per cent in early trade to 8,087.00. The market responded badly to a warning from the America's second largest bank, JP Morgan Chase, which said bad loans and weak trading results would hit third-quarter earnings.
The news sent the group's own shares down 12 per cent and reverberated across banking stocks in Europe. This afternoon, London's benchmark FTSE 100 index had sunk through the symbolic 4,000-point level to 3,929, a decline of 2.5 per cent.
Analysts said weak market data and a raft of cautious outlooks had compounded nervousness among investors.
In Dublin the ISEQ index shed 122 points or 2.8 per cent with banks applying the downward presssure. AIB and Bank of Ireland bothg posted 3.5 per cent losses.
In Frankfurt, the DAX index tumbled to five-year lows by mid-afternoon, losing nearly 4 per cent to 3,167. The DAX's latest slump means that it has now lost 42 per cent of its value since March, making it the worst-performing stock index in Europe.
The combined market value of the blue chip firms listed on the DAX has fallen by a total of euro318 billion - equivalent to the annual economic output of Poland - over the same period.