The US Federal Reserve looks set to slash interest rates on Tuesday, and the US government is to begin implementing its multi-billion-dollar bank bailout, but those moves do not seem to be helping the markets.
After an early drop of about four per cent, South Korea's Kospi index recovered slightly to edge into positive territory and Hong Kong's Hang Seng was also in the black, trading up more than four per cent.
But in China, Singapore, Taiwan and Australia, stock prices continued to decline, following a volatile overnight trade on Wall Street driven by fears of a recession and a bleak outlook on corporate profit.
"Confidence is certainly lacking. It hasn't been restored by anything anyone's done of late," Hans Kunnen, head of investment markets research at fund manager Colonial First State, said.
The Dow Jones Industrial Average dropped by 203.18 points or 2.42 per cent on Monday to close at 8,175.77 in a see-saw trading session that also saw intraday gains of as much as 200 points for the index.
Alfred Goldman, chief market strategist at Wachovia Securities, said the market's late drop reflected investors' ongoing concern over the direction of the economy.
"When confidence is razor-thin, the nervous tension goes way up and, bam, the
sellers take over."
"It's just an overall malaise about how bad the economic slump is going to be globally," he said.
Moves by Taro Aso, the Japanese prime minister, to introduce measures on Monday to calm stock markets failed to revive flagging sentiment.
During an emergency meeting of the Japanese cabinet on Monday, Aso called for steps including tighter controls on short-selling and expanding a government fund to recapitalise banks to as much as 10 trillion yen ($106.1bn) from two trillion yen, Kyodo news agency reported.
In a further sign of the impact of the global economic slowdown, Japanese consumer electronics giant Canon said it was lowering its net profit forecast for 2008 by 25 per cent, due to the global slowdown and the strengthening of the yen.
The company said that the sharp recent falls on global markets had "increased concern over the impact to the real economy".
"Additionally, drastic fluctuations in exchange rates between major currencies have led to a heightened sense of uncertainty over the future," it said.
On Monday, a surprise statement from the Group of Seven (G7) leading industrialised nations hinted at further intervention, saying its members would co-operate to aid stability.
But that appeared to do little to immediately boost investor confidence.