The Federal Reserve, European Central Bank and central banks from the UK, Canada and Switzerland are to jointly help banks deal with the credit crunch.
Weakness in sub-prime loans have destabilised the financial sector
They have each announced that they will provide billions in loans to banks in order to lower interest rates and ease the availability of credit.
The move was coordinated by the US Federal Reserve, which has already cut interest rates three times this year.
It is a sign that despite rate cuts, banks are nervous about credit risks.
Shares on Wall Street initially reacted positively to the news with all three indexes sharply up by more than 2% at one point.
But the gains gradually fizzled out as investors contemplated the possibility that company profits would still slow even if banks' troubles were ironed out.
The Dow Jones Industrial Average closed up 41.13 points, 0.31%, at 13,473, while the broader S&P index rose 0.61% and the technology-heavy Nasdaq ended 0.7% higher at 2,671.14.
World oil prices, which had dipped back at the start of December from their record highs at near $100 a barrel last month, barrelled higher on the hope that the Fed's coordinated steps would be aggressive enough to keep the global economy on track an