World stocks fell sharply on Monday, battered by fears of US recession and investor disappointment about a fiscal rescue plan promoted by the US administration.
MSCI's main world stock index was down 1.8 per cent, nearing their 2007 low. European shares were down more than 2 per cent a short while after opening, taking their 2008 year-to-date losses to nearly 12 per cent.
Japan's benchmark Nikkei average lost 3.86 per cent to close at a two-year low.
US stock markets were closed on Monday for a holiday. Demand for safe-haven bonds was high. (Reuters)