World share markets dive as US recession approaches

US and European stock markets plunged  again overnight amid fears of new collapses and  fresh warnings of a US recession.

The Dow Jones industrial index, which was 800 points down at one stage, closed  480.67  points lower at 9,844.71.

The S&P 500 also closed 49.40 points down at 1,049.83.

And the tech-heavy NASDAQ composite index fell 94.83 points to 1,852.56.

In Europe, the Standard and Poors 500 index was trading 6.3 per cent down, a short time ago.

The US President, George W Bush, appealed for patience, saying the $US700 billion bail out plan, which Congress passed last week, would take time to work.

“We don’t want to rush into this and not have the program be effective,” the President said, after talking to customers at a San Antonio lunch counter.

Meanwhile, a new survey showed that a growing percentage of economists in the US believe America is in, or near, a recession.

And one US economist, Paul Krugman, says he fears that the current crisis will “accelerate.”

Oil prices also fell, dropping $US5.32 a barrel to a new low of $US88.56

But Australian motorists won’t see much immediate benefit at the petrol pump.

That’s because the $A has also fallen.

It was selling at just 71.01 US cents a short time ago, after coming close to parity with the $US earlier this year.

However, Australia will benefit from a sharp rise in gold prices overnight.

Gold prices rose $US34.70 an ounce to $US867.90.