Financial Crisis Hits World Markets

LONDON, Sept. 30, 2008 -- The financial crisis has left Wall Street reeling, and begging, for a handout. The implications of the House rejection of the proposed $700 billion bailout plan have been felt well beyond the bustling streets of New York's financial district.

Across Europe, the U.K.'s FTSE 100 fell 5.3 percent, Germany's DAX index was down 4.2 percent and France's CAC-40 saw a 5 percent fall Monday as trading mercifully ended.

Asian markets have not been spared either. Japan's Nikkei fell 4.12 percent despite the Bank of Japan seeking to increase liquidity and lending by injecting 3 trillion yen into money markets. Hong Kong's Hang Seng index also fell 5.6 percent before ending the day with a gain. The Chinese markets are closed this week because of a national holiday.

On Monday, Washington voted on what many hoped would offer a silver bullet fix or at least some progress to alleviate the problem. But help from the Beltway did not come as the U.S. House of Representatives rejected the proposed $700 billion bailout plan by a vote of 228-205.

European markets have rebounded today, along with U.S. stocks. U.K.'s FTSE 100 followed its early morning gains as it rose more than 117 points at one point during the day, France's CAC was up nearly 85 points and Germany's DAX had gained more than 23 points before closing.

Michael Hunter of the Financial Times told ABC News the stabilizing of European markets is a result of a simple deduction by investors. "We've hit the bottom. The only way to go is up." Hunter said there is of course no way of knowing if that is the case.

Will the Asian markets follow the same pattern in making a comeback? "Some have started to recover, but [others] haven't had time to recover," said Hunter, referring to the 135.53 point gain on the Hang Seng Index in Hong Kong.