As the European Central Bank intervened again to boost flagging liquidity and European and Asian traders dumped shares on fears of a global credit crunch, economists stressed that the health of the world economy remained good.

"The underlying picture still looks reasonably good in terms of economic growth, in terms of corporate profitability, in terms of the balance sheets of companies," said Henk Potts of Barclays Stockbrokers.

Investors have been alarmed by signs that losses in the US subprime mortgage market -- high-risk property loans to which many US banks and investment funds are exposed -- could spread to other regions.

BNP Paribas, France's biggest bank, spooked the market on Thursday when it said it had suspended three investment funds exposed to the US housing market because it was unable to value its assets.

Philippe Waechter of Natixis Asset Management, who has downplayed the risk of a generalised economic meltdown amid the recent turmoil, told AFP Friday that the BNP decision nevertheless gave cause for concern.

"With BNP Paribas, a major player in the international banking system has been affected, outside the United States. So we can't rule out other major players also being affected, in Asia, central Europe or elsewhere," he said.

"If that happens, the growth on which everyone has been depending, saying 'it will get better, the crisis is only temporary' could be called into question, forcing central banks to adopt much more flexible monetary policies, and not simply providing liquidity to the market."