The Dow Jones has been hit hard for most of the week by investors cashing in profits.

It plunged back below 9,000 on Thursday, dropping 184.86 points to 8,879.68 by the closing bell, despite a concerted move by 11 European banks to cut interest rates.

Traders said the situation in Asia and in Latin America overwhelmed the good news from Europe.

The concerted rate cut by European banks failed to inspire Wall Street

In Brazil, the government's economic recovery plan has run into obstacles as Congress rejected a key measure in the draft austerity package.

Brazil is viewed as a lynch pin for Latin America's financial health, and weakness in that region would hit US corporate earnings hard.

Bill Meehan, chief market analyst at Cantor Fitzgerald, said: "Brazil is counterbalancing the European rate cuts, and the US markets are really concerned about exposure, especially hedge fund exposure, to Brazil."

Investors were also unhappy at figures which revealed that the Japanese gross domestic product had shrunk over the summer.

It means the second biggest global economic power has recorded negative growth for the fourth consecutive quarter.

Euro bourses feeling positive

However the concerted rate cuts by euro zone nations helped to fire volatile European shares to higher closes on Thursday

In London the FTSE 100 index closed higher for the first time in four sessions, up 1.1% after a roller-coaster session boosted by the cuts.

At the close the FTSE stood at 5566.1 - up 58.9 points.

It was a similar story in Germany, where the Dax ended more than 2% higher.

On the Paris bourse, the euro-zone rate cut also hauled its stocks out of the red.