World stock markets fell sharply on Wednesday and currency markets churned as casualties mounted from worsening credit markets and investors scrambled away from riskier assets. The slide in global equity and credit markets led investors to cut back on risky carry trades, Reuters reported. European shares were down more than two percent, following similar losses in Japan and a four percent tumble in the rest of Asia. MSCI's main world equity index lost 1.4 percent and is now down around 6.5 percent in a week and a half. Safe-haven government bonds gained while the Japanese yen climbed and high-yielding currencies dropped on the unwinding of popular borrowing trades.
