Financial markets in Europe fell to levels not seen in seven years this morning as fresh worries about war in Iraq and the US economy spurred another wave of selling.
In London the FTSE 100 index has lost nearly 3 per cent this morning as heavyweight banking and oil stocks came under pressure. The leading index was down 106.8 points, trading at a fresh 7-1/2 year intra-day low of 3,345.9 points by 11 a.m.
Banks and oil stocks were responsible for around a third of the overall losses.
European shares reeled to lows not seen for over six years in morning trade as investors dumped stocks across the board after US stock index futures shed earlier gains and headed south.
"It's just more of the same - confidence drains away from these markets on a daily basis now," said Mr Chris Johns, global strategist at ABN AMRO in London.
"It's obviously related to Iraq as it's contributing to people's assessment of risk, and it's also hurting economic growth. Data suggests the US economy hit a wall in February. You could also argue the high oil prices are a classic shock too," Mr Johns said.
The chemical, oil, insurance, banking, healthcare, auto and financial sector were all down by 2 to 3 per cent.
Technology leader Nokia was one of the few blue chip advancers after analysts upgraded the stock, saying it looked cheap.
The FTSE Eurotop 300 index of pan-European blue chips sank 1.97 per cent to 692 points, a level last seen in mid-December 1996.
In Dublin the ISEQ is down 29 points at 3,759.70, a fall of 0.77 per cent. In line with other European bourses banks have come under selling pressure.
Declining issues outpaced advancers by a wide five to one margin, but volume is still only moderate.