Global stock markets have plunged as a jump in US jobless figures and fresh rounds of job cuts worldwide deepened fears of recession and sent investors fleeing for cover.
Wall Street hit its lowest point since 2003 as government data showed jobless claims soared last week to a 16-year high of 542,000, sparking another round of heavy selling on Wall Street and in Europe.
The Dow Jones Industrial Average fell 2.52 per cent to 7,795.69 points, before recovering to trade up 0.49 per cent at 8,036.47. The tech-heavy Nasdaq dropped 2.58 per cent to 1,350.61 before trading up 0.94 per cent at 1,399.45.
London's FTSE 100 stock index fell 3.26 per cent to close at 3,874.99 points. In Frankfurt the DAX lost 3.08 per cent to 4,220.20 and the CAC 40 in Paris plunged 3.48 per cent to 2,980.42.
"Any remaining confidence in global markets has been well and truly trampled on today as investors throw in the towel," said David Evans, an analyst at BetOnMarkets.com.
"After months of bailouts, mini rallies, more bailouts and false dawns, investors have had enough," Evans said.
"There has been a panicked flight to quality today as the yield on the shortest term US treasury bonds sinks to near zero," he added. "Money is flooding to what is perceived to the safest haven in these troubled times."
Among more grim economic news, the US Conference Board reported that its forward-looking index of leading economic indicators declined 0.8 per cent in October. Data on Wednesday showed plunging US consumer prices and home building starts.
Several heavyweight manufacturers announced job cuts on Thursday, worsening the gloom.
Isuzu Motors said it would cut 1,400 jobs and slash domestic production by 10 per cent, the latest in a slew of layoffs by Japanese automakers to cope with a global economic slowdown.
French carmaker PSA Peugeot Citroen announced plans to cut 3,550 posts.
In London, the British maker of plane engines Rolls-Royce said it anticipated cutting between 1,500 and 2,000 jobs worldwide in 2009.
Anglo-Swedish pharmaceuticals giant AstraZeneca said it would remove 1,400 positions across Europe by 2013 and British defence manufacturer BAE Systems was shedding immediately 200 jobs at its land systems business in Britain.
Gulf stock markets ended mixed on Thursday - the final day of their trading week - as Kuwaiti shares continued their recovery on the back of a government rescue plan.
The seven bourses of the oil-rich region have shed about $US350 billion ($A550 billion) of their market value in the past seven weeks and as much as half a trillion dollars ($A785 billion) since the start of the year.
"It has already been a remarkable year" for stock markets, said David Evans, at BetOnMarkets.com. "At current levels, it stands to be one of the worst on record."
