The European Stoxx 600 closed the week down 22% in its worst week on record. The UK's FTSE 100 fell 8.5% on the session in its worst one-day drop since 1987. The Japanese Nikkei closed down 9.6% for a cumulative 23.5% decline on the week.

North American stocks have been extremely volatile on Friday. The VIX, which measures volatility in the S&P 500, hit a record high of 74.46. Until this month, the measure had never risen above 50 and only closed above 40 a handful of times. Scores of veteran traders have said they've never seen anything that nears the panic and fear that has gripped markets.

The S&P 500 is down 33 points, or 4.4%, to 876 and is poised to close down 20.8% on the week. Financials are a drag as Morgan Stanley and Goldman Sachs shares are down 34.7% and 18.6% respectively.

The Dow Jones industrial average is down 272 points to 8307 and the Nasdaq is down 53 points to 1592. There are rumours the U.S. government is considering closing equity markets on Monday to extend the time G7 officials have to formulate some type of co-ordinated plan. The White House said it has no plans to "interfere with the functioning of markets."

Canadian shares are getting sideswiped by a sell-off in commodities. WTI crude oil is down $5.74 to $80.85. The S&P/TSX composite index is down 370 points, or 4.1%, to 9230. The index is down 15% on the week.

Statistics Canada revealed the economy added 106.9k jobs in September. It's the highest reading on record (dating back to 1976) but was highly concentrated in part-time jobs. Still, the Canadian dollar is down 0.0342 to 0.8446 against the U.S. dollar (1.1842 USD/CAD) and down 2.74 to 84.06 against the yen.

"This morning's blockbuster employment report had surprisingly little effect on USDCAD," said Jacqui Douglas, currency strategist from TD Securities. "With an unbelievable 107K gain, we wonder if markets are shrugging it of as just that - unbelievable - and that a more moderate gain of something closer to 20K would have inspired a little more optimism."

The U.S. dollar is down 0.28 to 99.53 against the yen and the Dollar Index is up 0.954 to 82.117.

The euro is down 0.0113 to 1.3492 against the U.S. dollar, up 0.0327 to 1.5973 against the Canadian dollar, down 0.0045 to 0.7911 against the pound sterling and is lower by 1.52 to 134.28 against the yen.

The pound sterling is down 0.0044 to 1.7053 against the U.S. dollar and up 0.0522 to 2.0187 against the Canadian dollar.

The front month gold contract at the Chicago Board of Trade is up $0.80 to $887.30 per ounce.

U.S. two-year yields are up 5.4 bps to 1.59%, with five-year yields up 10.3 bps to 2.78%, 10-year yields up 8.0 bps to 3.86% and 30-year yields up 2.7 bps to 4.13%. The Eurodollar March 09 contract is up 9.5 ticks to 97.65. The yield curve is steeper, with the 10/2-year spread up 2.9 bps to 227.50 bps.

Yields on two-year Canadian government bonds are up 8.5 bps to 2.22%, with five-year yields up 13.8 bps to 2.93%, 10-year yields up 15.2 bps to 3.79% and 30-year yields up 8.6 bps to 4.25%. The December 08 BAX contract is down 3.0 ticks to 97.50.

In Germany, returns on two-year German bonds are down 6.0 bps to 3.02%, with five-year yields up 4.6 bps to 3.55%, 10-year yields up 13.6 bps to 4.01% and 30-year yields up 20.2 bps to 4.41%.

Yields on UK two-year bonds are down 8.2 bps to 3.53%, with five-year yields up 0.8 bps to 4.14%, 10-year yields up 9.6 bps to 4.46% and 30-year yields up 12.1 bps to 4.49%.

All data taken at 12:25 p.m. EDT.

By Adam Button, This email address is being protected from spam bots, you need Javascript enabled to view it , edited by Nancy Girgis, This email address is being protected from spam bots, you need Javascript enabled to view it

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