A crisis of confidence weighed on Asian shares Wednesday with several indexes slumping to multiyear lows as investors worry about the impact on corporate earnings from the financial-sector upheaval and a slowing global economy.

with stocks plunging in Europe and Asia. The Tokyo market had its worst decline since the 1987 crash. The British government’s announcement of a plan to bail out the country’s foundering banks with about $88 billion of new capital did little to restore market confidence, with banks again leading indexes lower Wednesday after the Dow Jones industrial average fell 5.1 percent in New York Tuesday.

“It was a horrible session in New York and a horrible session in Tokyo,” Jim Reid, head of fundamental credit strategy at Deutsche Bank in London, said. “The momentum is negative.”

“I think there are probably more bank failures and forced consolidation to come in the financial sector,” Reid said. “Whatever day of the week you wake up, it’s another country having problems.”

Japanese stocks plunged 9.4 percent Wednesday, leading the Nikkei 225 to at 9,203.32, the lowest since 2003. It was the biggest single-day loss in the index since October 1987. The selloff followed Tuesday’s drop of more than 3 percent. The index is now down 40 percent in 2008.

Toyota Motor, Nissan Motor and Honda Motor all fell more than 10 percent on expectations that the global downturn, and particularly the faltering U.S. economy, would hit their results.

"I don't think we've seen capitulation yet. The boost from the Australian interest-rate cut [Tuesday] didn't last long and the problems in the U.S. and the Eurozone remain," said Westcomb research head Goh Mou Lih in Singapore.

Overnight, the Dow Jones Industrial Average fell 5.1% to 9447.11 with the Standard & Poor's 500 down 5.7% at 996.23. Both indexes had their lowest close since Sept. 30, 2003.

The declines came ahead of the details of a U.K. bank-rescue package and as Federal Reserve chief Ben Bernanke issued some downbeat comments on the U.S. economy, potentially opening the door to a rate cut there.

Still, the lack of coordinated rate cuts by major central banks after Australia's one-percentage-point easing had disappointed some. "Until governments or central banks tackle the underlying problem [of a lack of lending], nervousness will remain," said analysts at BNP Paribas.

In European morning trading, the DJ Euro Stoxx 50 index, a barometer of euro zone blue chips, fell 7.2 percent. The FTSE 100 index in London declined 6.7 percent, the CAC-40 in Paris fell 8.2 percent, and the DAX in Frankfurt fell 7.5 percent.

Indonesia has a large export-driven economy closely tied to the economy of the United States. But analysts said despite the current panic here they expected the market to simmer in the coming days.

“Across the board, people are trying to rotate out of the stock market and into a more safe haven,” said Gita Wirjawan, the former president director for JPMorgan in Indonesia. “It is to some extent attributable to a bit of panic, the market has some exposure to risk, but it won’t be to the extent of China, India or Japan.”