Gordon Brown is chairing the first post-summer Cabinet meeting
One of Gordon Brown's leading critics has said his campaign for a change in Labour's party leadership is over.
Labour MP George Howarth told a Parliamentary Labour Party meeting that at a time of national crisis, the Labour Party must come together.
Mr Brown's summer has been dominated by speculation about a possible leadership challenge but Mr Howarth said at the meeting that "hostilities are over".
The new cabinet met on Tuesday for the first time since the recess.
Mr Brown's official spokesman said the PM updated ministers on the economic situation and explained what action was being taken at an international level.
Asked about specific action being planned, he said: "We are of course looking at every aspect with other countries and the financial sector... it would be irresponsible to speculate on the specifics of any future options."
Chancellor Alistair Darling did not attend the meeting because he was in Luxembourg meeting European finance ministers.
Business Secretary Peter Mandelson, who had a kidney stone removed on Monday, was among the first to arrive at No 10 for the meeting which lasted an hour and 20 minutes.
New Transport Secretary Geoff Hoon told reporters on the way out that the mood had been "serious", reflecting the economic circumstances.
At the PLP meeting on Monday evening, Mr Brown was applauded by Labour MPs as he insisted that the party could win the next general election, despite continuing to trail in the opinion polls.
Ministers Ed Balls and Yvette Cooper were among those at the cabinet meeting
According to one aide, he told the meeting: "People's minds are not yet set. We have got to go out and win the arguments on the economy."
Mr Howarth was among more than a dozen Labour MPs who, just three weeks ago, were calling for leadership nomination papers to be sent out to all of the party's MPs, to see if there was enough support for an election.
BBC political correspondent David Thompson said Mr Howarth's declaration of an end to hostilities seems to reflect the mood of most in the Parliamentary Labour Party, and perhaps draws a line under a summer of infighting, resignations and plots against the prime minister.
During the PLP meeting, it was also announced that the Glenrothes by-election will be held on 6 November, which is seen as another test for Mr Brown's leadership.
On Tuesday morning Mr Brown met New York mayor Michael Bloomberg at Downing Street. Speaking after the meeting, Mr Bloomberg said they had had a "traditional English breakfast" and he had met members of the cabinet.
He said the conversation had been about the current financial crisis and how countries could not tackle the problems in isolation.
"All of these leaders have to work together," he said.
"Every country seems to be going about it separately and we discussed the problems in doing that. You really can't, in a world where all of the major institutions have offices in every country and regulation in every country is different."