US shares suffered their biggest one-day fall when Wall Street reopened yesterday for the first time since last week's terrorist attacks.

The resumption of trading ended the stock market's longest shutdown since the Depression.

Within minutes, the Dow Jones and the Nasdaq tumbled as dealers priced shares lower in the aftermath of Tuesday's atrocities.

The Dow closed down 684.81 points at 8,920.70, or a fall of seven per cent, according to preliminary calculations.

The collapse came despite a bid by the Federal Reserve to boost confidence and avoid recession by cutting interest rates by 0.5 per cent to three per cent, an hour before Wall Street opened.

The US cut was followed by reductions by banks around the world, including the European Central Bank, which also shaved its rates by 0.5 per cent to 3.75 per cent.

The moves raised hopes that the Bank of England would follow suit with a swift cut in rates from the present five per cent.,

Traders said this could happen in the hours or days ahead, although the Bank of England refused to comment.

Tom Hougaard, trader at Financial Spreads, said: "There are heavy rumours that the Bank of England will cut interest rates soon.

"Something is on the cards - the Fed has cut, National Bank of Canada has cut, the European Central Bank has cut, so has Switzerland."

In London, the FTSE-100 surged ahead on hopes of a cut, closing up 143.2 points at 4898.9.

Reopening of the New York Stock Exchange was symbolic of America starting to return to normal after last week's atrocities.

The market has been closed for four days - the longest time in recent history - and was reopened following a two-minute silence where traders paused to remember the thousands of dead and injured in the attacks on the World Trade Centre and the Pentagon in Washington.

Despite yesterday's huge fall, investors are still hoping that America will mount a "patriotic rally" on the markets soon, with hopes that shares could rise on optimism for the future and in a determined effort not to let terrorism win.

It was far from business as usual as lower Manhattan went back to work.

Wall Street workers some carrying American flags, some wearing masks to ward off the smoke, were greeted by police checking identification.

A few blocks away, rescuers continued the desperate work of sifting the wreckage of the World Trade Centre, still hoping to find survivors.