After money markets in the Far East dropped significantly overnight the UK Stock Exchange received an early morning wake-up call with an immediate 5 per cent fall followed a further slow decline until we heard that hancellor Darling was due to make an announcement in the House of Commons later in the day. That prompted a minor recovery during the afternoon, but when the announcement came and amounted to nothing specific the FTSE 100 lost further ground resulting a single day fall of over 8 per cent, the third worst in the indexe's history. The reaction to Darling's announcement expressed the market's sentiment that more was needed.

 

In the US similar reactions are taking place as the financiers begin to understand the details and likely impact of their Government's 700 billion dollar bail-out. The Dow Jones has already lost over 4 percent and the NASDAQ over 5 per cent today.

 

Over in Iceland the Government has announced unlimited guarantees for deposits in domestic banks. Iceland has been one of the countries to dramatically grow their footprint in global finance circles over recent years, with large-scale investments in various markets across Europe, but the aggressive strategies of its bankers could be coming back to bite them and the loans they used to fuel there investments could be looknig more and more unsteady. Today all trading in stock of Iceland's banks was suspended.