US stocks fell in morning trading in New York, echoing declines in Europe and Asia as fears of a global recession continued to hit investor confidence.
Wall Street's main Dow Jones index was down 2.9%, while in Europe, the UK's FTSE 100 lost 4.5%, Germany's Dax fell 5%, and France's Cac gave up 5.1%.
had lost 4.5% in late trading, and Germany's Dax ended down 5%.
Job cuts at Yahoo and drugs firm Merck have increased economic concerns.
The falls came as the White House said a global summit to tackle the financial crisis will be held next month.
The meeting will debate the reforms needed to avoid another financial crisis and look at the progress currently being made.
Leaders from the G20 group of nations - the world's leading industrialised countries and major developing nations - will attend
'Rapid deterioration'
Investor sentiment was also hit on Wednesday by warnings from both UK Prime Minister Gordon Brown and Bank of England Governor Mervyn King that Britain was most likely now entering its first recession in 16 years.
In the short term, the comments made by Mervyn King highlighting the fact that the economic environment has deteriorated quite rapidly over the past year have sent a shudder through the foreign exchange and equity markets," said Henk Potts, an equity strategist at Barclays Wealth.
"There's been a housing slump, the labour market has been suffering and business confidence has been hammered - it's no surprise that investors are spooked," he added.
Stocks were also dragged down by commodity stocks tracking weaker oil and copper prices.
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