Investors agonizing over a faltering economy sent the stock market plunging all over again Wednesday after a stream of disheartening data convinced Wall Street that a recession, if not already here, is inevitable. The market's despair propelled the Dow Jones industrials down 733 points to their second-largest point loss ever, and the major indexes all lost at least 7 percent.

The Dow Jones index in New York sank nearly 8% and shares in Brazil by 10%. There were sharp falls in London and on other European markets. The FTSE 100 index of leading shares closed 7% down.

In a joint statement, the leaders of the G8 countries - the US, UK, France, Italy, Germany, Canada, Japan and Russia - said that changes had to be made to the "regulatory and institutional regimes for the world's financial sectors to remedy deficiencies exposed by the current crisis".

Analysts said the market was continuing to react to the same fundamental factors that drove it lower in the morning, including weakness in the manufacturing sector, the large drop in retail sales and the growing realization that there will be no quick fix to the credit crisis.

Retail sales decreased 1.2 percent last month, nearly double the 0.7 percent drop that had been expected, according to one government report, while an index of New York manufacturing hit a record low in September.

“To some degree, we’ve moved on from the old crisis to the new crisis. The credit crisis has been addressed to some extent, but now there’s the recession, unemployment, and rising manufacturing costs in the pike,”

After a host of European data Tuesday suggesting that the region was headed into a recession, Japan announced Wednesday that its current-account surplus shrank 52.5 percent from a year earlier, more than economists had expected. More alarming, exports during the month edged up only 0.9 percent, while imports soared 20.2 percent from a year earlier, mostly because of higher oil prices. Japan has suffered from weak domestic demand for a decade and sales overseas have been a major support to the country’s economic growth.

Good news could be around the corner for borrowers. With some order restored to the banking sector, and interest rates already slashed from 5 to 4.5 per cent, experts are predicting that come Christmas the cost of borrowing could be less than 4 per cent - and could even fall to as low as 2 per cent next year, according to the Daily Mail.