Banks were among the major losers in the US, United Kingdom (UK), Asia and other parts of Europe and Africa.

But in Nigeria, the impact of the crisis was not directly felt. Three stocks appreciated, 48 others dropped in value, in continuation of the meltdown in the market, which up till March was a cash cow.

In Abuja yesterday, former Pakistani Prime Minister Shaukat Aziz, at the Northern Nigeria Economic and Investment Summit (NEIS), said no country, no matter how small, could ignore the financial crisis.

He said the global financial sector was in a "terrible state".

The Nigerian Stock Exchange (NSE) dropped N46 billion to close at N9.684 trillion at the end of trading. The All Share Index dropped 207.72 points to close at 45,504.69 points.

The market has been on a continuous fall in recent weeks. The capitalisation dropped by N54.5 billion last Thursday, which was the first day of trading this month. It dipped further by N52.7 billion on Friday.

The slow but steady decline in the market value is an indication of deepening investors’ apathy.

In other parts of the world, markets defied measures being put in place by governments and central banks to contain the financial crisis.

A fragmented response from Europe led top U.S. officials to call for a "forceful and coordinated" global reaction as the Dow industrials skidded more than 400 points and fell below 10,000 for the first time in four years. The credit markets remained under strain.

The stocks plunge forced investors to sink money into what they considered the relative safety of U.S. government debt.

Fears about a global recession also caused oil to drop below $90 a barrel; and the benchmark index that gauges fear in the market jumped to the highest level in its 18-year history.

The selling was so extreme that only 98 stocks rose on the New York Stock Exchange (NYSE) — and 3,092 dropped. It was a sign of the crisis in the market, which is considered a leading economic indicator, with investors tending to buy and sell based on where they believe the economy will be in six to nine months.

Even though the Nigerian market was slow to react to the global market meltdown triggered by the US sub-prime mortgage loans crisis, it has lost N5.803 trillion (about 30 per cent of its value) from March, when it became depressed, to the end of last month. Market capitalisation stood at N15.64 trillion by the beginning of March, but by the end of last month it had plummeted to N9.837 trillion.

Economists seem to disagree on the impact of the crisis on the market.

Former Finance Minister, Dr. Kalu Idika Kalu, said the market meltdown did not have any direct bearing on the crisis.

He said while the US financial crisis emanated by sub-prime mortgage loans that of Nigeria was caused by the wrong investment of resources accrued to the country over the years.

But the Chief Executive Officer, Economic Associates, Dr. Ayodele Teriba, said the global credit crunch had squeezed liquidity in the financial system.

"We are in a situation where the developed markets are facing scarcity of liquidity. That means that the money that used to arrive looking for investment in Nigeria has reduced. We are now seeing reverse flow because the confidence in their markets is still very weak," he said.

"The fact is people are scared and the only thing they’re doing is selling," said Ryan Detrick, senior technical strategist at Schaeffer’s Investment Research.

"Investors are cleaning out portfolios and getting rid of everything because nothing seems to be working."

Yesterday’s steep decline on Wall Street indicated that US investors were becoming more convinced that the country is championing a prolonged economic crisis that is spreading to other nations. Over the weekend, governments across Europe rushed to prop up failing banks. The governments of Germany, Ireland and Greece said they would guarantee bank deposits.

In London, the government promised to protect "ordinary depositors" amid fears that it may seek partial ownership in return for support of bank proprietors.

The leading share index recorded its biggest ever one-day points fall with banking and commodity stocks crashing.

The Financial Times Stock Exchange (FTSE) 100 ended 391.1 points lower at 4,589.2, down 7.8 percent, the third biggest percentage decline, taking the index back to levels not seen for over four years.

No blue chip stock ended in positive territory.

"Another Monday, another banking crisis. Just when the market thinks it has found a base level, there’s another jolt to the system." said Manoj Ladwa, senior trader at ETX Capital.

" Black Mondays used to be a once-a-decade event, now they’re coming along more regularly than a London bus," Ladwa added.

Banks were among the biggest blue chip fallers with Barclays, Royal Bank of Scotland and HBOS down between 14.7 and 20.5 percent. Chancellor Alastair Darling told parliament in the afternoon that a Banking Bill will be introduced Tuesday to build on special powers the UK government took in February.

The UK shareholders Association said it had received 300 complaints from private Bradford and Bingley shareholders who have received no information on the fate of their holdings.

"The government has confiscated £1.5 billion pounds in assets and haven’t said what they’re going to do with it," its spokesman said.

While the U.S. tried to shore up its battered banking system, the German government and financial industry agreed on a $68 billion bailout for commercial-property lender Hypo Real Estate Holding AG. France’s BNP Paribas agreed to acquire a 75 per cent stake in Fortis’s Belgium bank after a government rescue failed.

The Fed also took fresh steps to help ease seized-up credit markets. The central bank said it would begin paying interest on commercial banks’ reserves and would expand its loan programme to squeezed banks.

In midday trading, the Dow Jones industrial average fell by 476.13, or 4.61 percent, to 9,849.25, dropping below 10,000 for the first time since October 29, 2004. At one point, the Dow was down nearly 600.

Broader indexes also tumbled. The Standard & Poor’s 500 index shed 53.12, or 4.83 percent, to 1,046.11; and the Nasdaq composite index fell 101.86, or 5.23 percent, to 1,845.53. The Russell 2000 index of smaller companies dropped 26.33, or 4.25 percent, to 593.07.

In Asia, the Nikkei 225 closed 4.25 percent lower. Europe’s stock markets also declined, with the FTSE-100 down 5.20 percent, Germany’s DAX down 7.07 percent, and France’s CAC-40 down 9.04 percent.

The anxiety was again obvious in the credit markets. The yield on the three-month Treasury bill slipped to 0.42 percent from 0.50 percent late Friday.

Investors also moved into longer-term Treasury bonds. The yield on the 10-year note fell to 3.49 percent from 3.60 percent late Friday.

Emerging markets, which had gained most from the boom in commodities demand and surging global expansion in the last three years, were also hit. Trading was halted in markets as far afield as Brazil and Russia when their indexes nosedived 15 percent.

"This is a stampede," said Valerie Plagnol, chief strategist at CM-CIC Securities in Paris.

French President Nicolas Sarkozy issued a statement from the 27-member states of the European Union, saying individual countries would do all they could to safeguard the financial system. Euro zone finance ministers gathered in Luxembourg in an attempt to contain the crisis.

The banking upheaval that began on Wall Street shut down interbank and other loan markets, pushing industrialised countries closer to recession. Conditions remained poor for inter-bank lending.

While Sweden, Austria and Denmark followed Germany’s lead by offering guarantees to savers, investors from Tokyo to London continued to slash risk from portfolios and positioned themselves for a further tightening of credit and bank lending.

In Texas, President George W. Bush said it would take time to restore confidence in the financial system and free up credit, telling reporters it was important that the rescue programme did not waste taxpayer money.

"We don’t want to rush into this situation and not have an effective programme ... The one thing people can be certain of is that the bill I signed is a big step toward solving this problem," Bush said.

In a panel discussion in Chicago, former U.S. Securities and Exchange Commission chief Richard Breeden called the crisis "a 900-foot tsunami" and chided Treasury Secretary Henry Paulson for wanting, as recently as a year ago, to reduce regulation.

In Europe’s sudden transformation of its banking sector, France’s BNP Paribas agreed to scoop up assets in Belgium and Luxembourg of banking and insurance group Fortis for 14.5 billion euros ($20.1 billion) to become the euro zone’s biggest deposit bank.

Germany abandoned plans to handle its domestic banking problems on a case-by-case basis and is now considering a nationwide umbrella to shield its entire financial industry.