For the week, the Dow Jones Industrial Average fell 1.5 per cent, the SP 500 1.7 per cent and the Nasdaq 0.96 per cent.
In Europe London's FTSE index stood out as a gainer, adding 1.39 per cent, but the other markets tumbled: the CAC 40 lost 2.0 per cent for the week, and the DAX, 3.8 per cent.
In Asia the Nikkei tumbled 3.6 per cent for the week, while the Hang Seng Index of Hong Kong gave up 4.3 per cent.
The first spark to a huge selloff on Monday was Standard Poor's controversial, historic downgrade of the US credit rating. That sent US stocks on their second plunge in three days, after one the previous Thursday, with an impact that was echoed around the world.
Markets thrashed around on Tuesday as new worries surfaced in Europe over the debt crisis possibly enveloping Italy and Spain, but mostly recovered their losses for the day on assurances from the European Central Bank, and the US Federal Reserve's pledge to keep interest rates ultra-low for two more years because of sagging economic growth.
But the Fed move bared the touchiness of the markets - the Dow first rose, then plunged, and then rocketed back up on the rate news.
Wednesday more rumours in Europe, including that France might be downgraded in the wake of the United States, sent markets tumbling again; bank stocks were a focus of selloffs in both Europe and the US.
Thursday, the markets shot up again, as European authorities strained to calm the rumour mill while American traders turned their focus back to individual stocks and their valuations.
Finally on Friday, the markets held onto and added to the gains of the day before, helped by a ban of short sales of bank stocks in four European countries and reasonably positive data on consumer spending in the United States.
The turbulence sent investors and businesses fleeing to safe-havens, and gold pushed to a record high on Thursday at $1,814.95, before dropping off to around $1,746 late on Friday.
Investors also sought out the Japanese yen and Swiss franc, prompting interventions by Japan's and Switzerland's central banks to prevent further rises.
And despite the US downgrade, traders fled into US Treasury bonds, sending yields at one point on Wednesday to historic lows. By the end of the week, the US benchmark bonds were still hovering near their lowest yields ever.
While calm returned on Friday, all the sources of the jitters - Europe's dubious capacity to get a hold onto its debt problems; Washington's ability to address the debt-and-deficit issues SP singled out - remained in the air.
Forex markets were also less turbulent on Friday, with valuations moving back to levels from the previous week. Late on Friday the euro was at 1.1084 Swiss francs, and bought $1.4250.
The dollar was trading at 76.78 yen and 0.7778 Swiss francs; the British pound bought $1.6281. China's yuan meanwhile continued its steady climb against the dollar during the week, the dollar dropping to 6.39 yuan compared to 6.45 a week earlier.
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