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World Stocks Tumble

Shares on the big indices drop around 2%, while selling is more intense in smaller markets.
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Stocks dropped sharply in Asia and sold off in Europe as well as the U.S. credit crunch continues to worry investors.

Japan's Nikkei dropped 2% and Hong Kong's Hang Seng gave up 3.3%, and those were some of the smaller drops. Stocks dropped 6.9% in Seoul, 5.9% in Jakarta, 4.6% in Taipei and 4.3% in Mumbai. Even China's highflying Shanghai Composite joined in the selling, sliding 2.1%.

Markets were in the red across Europe as well, with shares in London, Paris and Frankfurt all off 2.3% to 2.7%.

The declines come a day after the

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, the big mortgage lender that shed 13% after Merrill Lynch cut its rating to sell from hold and warned that the company could soon find itself hit by the liquidity crisis that has swept across the U.S. lending industry.