PARIS - EMERGING from the wreckage of an historically bad week of trading, dealers from Tokyo to London and New York say the financial turmoil has left markets in an irrational state of fear.

Some dealers buried their faces in their hands, unable to watch as index indicators steadily fell on Friday morning in scenes that were replayed around the world as each market opened.

Tokyo's Nikkei index crashed 24.33 per cent over the week for its worst five days of trading in its 50 years of existence. The Dow Jones fell eight straight days, for its worst week. London had its worst trading week since the 1987 crash.

'I have never seen anything like this and I hope I never go through anything like this again,' said Ms Valerie Plagnol, director of strategy for Credit-Mutuel-CIC in Paris, commenting on the clash of the stock fall and the credit freeze.

'It's been a long week in the history of the financial markets,' said Mr Joshua Raymond a strategist for City Index in London.

'What is happening now is not just history repeating. If you map out every single event along the way, we are setting a whole new precedent.'

A US$700 billion (S$1 trillion) bailout, an US$800 billion British package, coordinated interest rate cut by seven central banks - nothing seems to work.

Investors have been massively scared off.

'The markets have shown that it is naive to assume that the UK banking bailout and rate cuts this week would turn the market instantaneously; confidence takes months to build and hours to shatter,' added Mr Raymond.

'It's blood bath,' said Mr Hiten Agarwal of Bombay brokers Angel Broking.

The damage extended to commodities markets - just as it is quickly spreading through the whole economy.

'Markets are very much trading on fear, which has overwhelmed fundamentals,' said Mr Nimit Khamar at Sucden traders in London, talking about the oil market where prices have now fallen below US$80 a barrel.

Swiss bank Wegelin the intervention of governments and central banks had the opposite effect. 'Uncertainty and panic have been increased.'

'People just don't have the confidence to put their money back into the market yet,' said Mr James Foulsham, head of trading at CMC Markets in Sydney.

'We are going to need some stability first before we start seeing retail and even institutional clients come back in.'

So what is ahead? There is talk of a summit of global leaders which could take new measures.

Mr Justin Urquhart-Stewart, an analyst for Seven Investment Management said the action already taken by governments this week to ease the financial crisis and spur critical credit flows had to succeed.

'There is no Plan B,' warned Mr Urquhart-Stewart who has called the crisis a 'perfect storm' with a banking system in crisis and a critically slowing global economy.

There is doubt however.

'After this week's internationally coordinated cut in rates we do not think that there will be any other major measures announced, but we cannot be completely sure!' added Mr Philip Shaw of Investec.

Nearly all dealers insist that the end of the crisis will only come with the end of the freeze on credit lending.

'And right now,' said Mr Matt Buckland, a trader with CMC Markets, 'that is not in sight, despite the massive efforts of central banks.' -- AFP