Russian markets have taken fright at the arrest on Saturday of Mikhail Khodorkovsky, chief executive of oil giant Yukos.
Mikhail Khodorkovsky is said to be worth $8bn
Trading on Russia's MICEX stock exchange was suspended for one hour after an early morning tumble of more than 13%, dragged down by a fall in Yukos' share price.
The benchmark RTS index ended the day down 10%, with Yukos shares on the RTS closing down 15.4%.
The Central Bank also intervened to restore the rouble which fell half a percentage point against the dollar, spending more than $500m to keep the rouble rate at around 30 to the dollar.
The arrest of Mr Khodorkovsky, one of Russia's richest men, has far reaching implications since Yukos shares can account for as much as 30% of Russian market turnover.
The criminal case also raises fears among investors of a bruising confrontation between politicians and businessmen in the run-up to parliamentary elections in December.
Mr Khodorkovsky is charged with offences including defrauding the state out of $1bn.
The allegations relate to mass privatisations in the 1990s in which valuable state assets were handed to powerful businessmen in exchange for political favours.
Any indication that the murky deals of that era will be fully investigated could strike panic into Russia's business community.
Nerves in Moscow were felt in Turkey, a country with considerable with Russia, where the lira fell to a five-month low.
Uncertainty about Russia was also seen to weigh on the euro, the European single currency, which fell against the dollar and yen in early trading.
"The arrest is disgusting news for the market. I don't exclude that we are going to fall deeper," said Andrei Kukk, head of trading at
But analysts are cautious about the long-term implications of the Yukos case.
Russia's capital markets still play a relatively minor role in overall economic performance and investor confidence has generally been climbing in recent months.
"I don't think we'll see any repeat of the financial crisis of 1998 as we've seen some people talking about," Stephen O'Sullivan, oil and gas analyst at United Financial Group in Moscow told the BBC's Today programme.
"That's far too extreme. Russia's macroeconomic fundamentals and government macro policy are far better than in 1998."
But Yukos is seen as a pioneer in changing the image of Russian companies abroad, introducing corporate governance codes and appointing high-profile foreign directors.
Mr Khodorkovsky is more politically active than many other so-called business "oligarchs" and so a more obvious rival to the Kremlin.
"It is a serious dent in the good investor friendly image that Russia has managed to create over the last few years," said Mr O'Sullivan.
The Yukos case has also raised questions about investment in Russia's energy market.
Both ChevronTexaco and ExxonMobil are negotiating with YukosSibneft, the company emerging from Yukos's takeover last year of fellow oil giant Sibneft, for a sizable stake, which could help further develop Russia's huge oil reserves.
Those talks are now likely to be on hold until the crisis is resolved.