BBC: Stock markets in the US have fallen sharply as the cumulative effect of a weak dollar, soaring oil prices and the credit crisis again eroded confidence.
The benchmark Dow Jones index of leading shares tumbled 360.92 points, or 2.6%, on a day of fresh volatility.
Banking stocks were widely sold as fears over financial problems facing Wall Street showed no signs of abating.
Morgan Stanley said exposure to bad sub-prime related investments had reduced its profits by $2.5bn ($1.2bn).
Sub-prime liabilities on its balance sheet totalled $6bn at the end of last month while the decline in value of these assets had wiped $3.7bn off sales in the past two months.
"It is expected that market conditions will continue to evolve and that the fair value of these exposures will frequently change and could further deteriorate," Morgan Stanley warned in a statement after the stock market had closed. Economic worries knock US markets (more)
Mark Alexander
