The global financial crisis unleashed panic Monday in the stock exchange in Sao Paulo: just 18 minutes after the starting bell in the largest stock exchange in Latin America, trading was suspended after the leading index Bovespa fell over 10 per cent.

When trading resumed, stocks continued to fall in relation to the previous day's closing, and trading had to be suspended again, this time for an hour.

The circuit breaker is used automatically to calm down the markets in the Brazilian financial metropolis when there are changes of over 10 percentage points. Trading is then suspended for half-an-hour. Should the Bovespa fall by another 5 per cent after trading starts again, a new circuit breaker is prescribed, this time for an hour.

At 10.18 am (1318 GMT), the Bovespa had fallen by 10.5 per cent and trading was suspended.

Following the half-an-hour break, however, trading had to be suspended again at 11.44 am (1444 GMT), after the plunge reached 15.06 per cent compared to the previous day's close.

The Bovespa index, which was close to 74,000 points just a few months ago, is now at 37,814.44 points.

According to Brazilian economist Miguel Daud, the steep fall in markets around the world is evidence of the fear that the rescue plan passed last week by the US Congress is not enough to solve current financial turbulence, as well as of concern that Europe and other regions might be "contaminated" with financial sector problems.

"Brazil is vulnerable to that crisis, because it depends a lot on international liquidity," Daud noted.

The circuit breaker was introduced in Sao Paulo in the late 1990s, to face the successive foreign exchange crises that Brazil suffered 1995-1999, when the government of President Fernando Henrique Cardoso introduced a huge devaluation of the real and adopted a system of floating exchange rates.

The circuit breaker was triggered a week ago, for the first time in a decade, after the US House of Representatives initially rejected the government plan to rescue the financial sector.

In Mexico, at the start of trading, the IPC index was down by 9 per cent.

In the Buenos Aires stock exchange, in turn, the Merval index fell by 11.27 per cent in barely one hour at the start of trading. The authorities were evaluating whether to suspend trading completely but instead suspended trading only in certain shares.