Sponsored by BNP Paribas

For investors, the subprime crisis is the first real test of will since the Internet stock bust six years ago.

As the market punishes banks and lenders for loose lending practices, investors want to know what's really at stake.

It will be a weekend of high anxiety for investors on Wall Street, as they brace themselves for what will likely be another rollercoaster ride for the battered financial markets.

Wall Street's roller-coaster ride, triggered by the meltdown in subprime mortgage lending, is spreading pain through financial markets -- but has not hit Main Street yet.

Central banks probably will halt their monetary tightening campaign and the Federal Reserve may start cutting interest rates to ward off a global credit crunch, financial market dealers said on Friday.

Central banks around the globe pumped billions of dollars into banking systems on Friday in a concerted effort to beat back a widening credit crisis, and pledged to do more if needed. n all, central banks in Europe, Asia and North America have pumped out more than $300 billion over 48 hours in an effort to keep money flowing through the arteries of the global financial system, hoping to prevent a credit market seizure that could imperil economies.

The yen firmed broadly on Friday as continued turbulence in global financial markets caused investors to shun risk, cutting their exposure to carry trades.

Shares in Dutch bank ABN AMRO fell as much as 11 pct on Friday as analysts cited a report that Fortis may find it difficult to finance its part of the deal to buy ABN together with Royal Bank of Scotland and Santander.

The European Central Bank mounted a second day of action to calm panicky credit markets on Friday, after Asia central banks joined a global campaign by monetary authorities to inject extra cash into banking systems.

Federal Reserve Bank of Minneapolis President Gary Stern, playing down jitters in global money markets, said on Thursday that subprime mortgage problems were limited in scope and the Fed routinely injects substantial liquidity into the banking system.

Central banks from Tokyo to Sydney injected extra cash into banking systems or pledged to do so on Friday, as Asia joined a global campaign by monetary authorities to calm panicky credit markets.

Stocks tumbled on Thursday, with the Dow and S&P down nearly 3 percent, after a French bank froze three funds that invested in U.S. subprime mortgages, prompting central banks to take steps to calm investors. Evidence the U.S. mortgage market crisis was having a global impact and spreading to other markets hammered financial stocks.

Goldman Sachs Group Inc., known for its Midas touch, again found itself on the defensive Thursday amid speculation that two of its hedge funds had fallen sharply in recent weeks and were selling down positions.

France's biggest listed bank, BNP Paribas froze 1.6 billion euros ($2.2 billion) worth of funds on Thursday, citing the U.S. subprime mortgage sector woes that have rattled financial markets worldwide.

Stocks fell sharply on Thursday as another shoe dropped in the U.S. subprime mortgage sector meltdown, causing investors to flee riskier assets for the relative safety of government bonds. Stocks added to their declines after the Wall Street Journal reported a second Goldman Sachs Group Inc. hedge fund was suffering losses and was selling its positions.

The low-yielding yen jumped against the dollar and euro on Thursday as investors trimmed exposure to carry trades after BNP Paribas said three of its funds were hit by problems in the U.S. subprime mortgage sector.

Belgian-Dutch financial services group Fortis reported a 16 percent year-on-year rise in second-quarter net profit on Thursday, beating analysts' expectations due to strong banking results.

France's biggest listed bank, BNP Paribas, froze 1.6 billion euros ($2.2 billion) worth of funds on Thursday, citing U.S. subprime mortgage sector problems. The news sent shivers through nervous financial markets. It came as Germany's Bundesbank met to discuss a rescue package for lender IKB, which has been hit by the subprime crisis too.

Dutch bank ABN AMRO is continuing to hold talks with the Royal Bank of Scotland-led consortium which has offered 71 billion euros ($97 billion) for the Netherlands' largest bank in a bidding war with British bank Barclays, the two groups said on Sunday.

Oil prices slipped for a fourth day on Wednesday on forecasts of higher refinery production in the United States that would ease worries over fuel supplies during peak summer demand.

Fallout from a crisis in the U.S. subprime mortgage market rattled the auto sector on Tuesday after the debt package for a General Motors asset sale was postponed and borrowing costs on automakers' debt surged.

Federal Reserve chief Ben Bernanke provided cold comfort on Wednesday to those worried that the subprime mortgage mess will infect other areas of finance, though he lifted spirits in the bond market.

World stocks fell and the dollar hit a record low against the euro on Wednesday after signs of fresh woes in the U.S. high-risk mortgage sector rekindled concerns about the potential impact on the wider economy.

The Dutch Supreme Court will issue its ruling on ABN AMRO's suspended sale of its U.S. unit LaSalle on Friday and the decision could sway an acrimonious takeover battle for the Dutch bank.

Oil surged to an 11-month high above $76 a barrel on Friday, closing in on the all-time record as Nigerian disruptions and OPEC output cuts stirred supply concerns amid rising U.S. refiner demand.

Sterling jumped to a 26-year high versus the dollar for a third day on Wednesday, vaulting $2.02 and showing no signs of vertigo so far against a broadly weak dollar that stayed near record lows versus the euro.

Progress made by Britain's Barclays in its offer for ABN AMRO demonstrates its ability to offer the Dutch bank's shareholders certainty and deliverability, Chief Executive John Varley said on Wednesday.

Investors sold European stocks and bought government bonds and gold as trading got underway for the second half of 2007 on Monday, driven by security concerns after weekend bomb plots in Britain and higher oil prices.

Dutch Advocate General says ABN can sell its U.S. bank, LaSalle, without a shareholder vote.