A man walks past a branch of Barclays Bank in London, yesterday. Two days after walking away from a deal to purchase all of Lehman Brothers, Barclays PLC said, Tuesday, it had agreed to acquire Lehman's North American investment banking and capital markets businesses for US$250 million (€175 million, £140 million), in cash. The British bank will also purchase Lehman's New York headquarters and its two data centres in New Jersey for US$1.5 billion (€1 billion £840 million). - AP

NEW YORK (AP):

Stocks plunged Wednesday as investors remained worried about chaos in the United States financial market even after the Federal Reserve forged an extraordinary US$85 billion rescue of insurance giant American Inter-national Group Inc.

The Federal Reserve's emergency loan to shore up AIG, the world's largest insurer, temporarily lifted some uncertainty about the stability of the US financial system on Tuesday, but the market later plummeted as investors kept a wary eye on the company, which is reeling from billions of dollars in souring mortgage debt.

The two Wall Street investment banks left standing after a week of stunning upheavals - Goldman Sachs Group Inc and Morgan Stanley - also remain under scrutiny. And the troubles in banking could exacerbate economic problems. The Commerce Department said Wednes-day that housing starts fell by 6.2 per cent in August, to the slowest building pace since January 1991.

The Dow Jones industrial average dropped about 300 points. A 500-point drop on Monday marked the largest in the Dow Jones industrials since the September 11, 2001, terrorist attacks, as the venerable Wall Street giant Lehman Brothers filed for the biggest bankruptcy in US history.