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The stock market, which has been gyrating for weeks over fears that credit is drying up, pared its losses after the Fed’s injections of cash and following morning comments from the central bank that it would do all it can to “facilitate the orderly functioning of financial markets.” The steep declines seen at times during the session and persistent volatility, however, showed the depths of fear that had some investors yanking money out of stocks.

The level of funds markedly exceeded the ECB’s only previous major intervention on the day after 9/11 when it lent €69bn followed by €40bn over subsequent days. Even more striking was its one-day pledge to meet 100 per cent of all funding requests from financial institutions.

This liquidity injection was designed to ensure that money markets continued to function and did not succumb to a credit freeze. The Federal Reserve followed suit although in far less dramatic fashion.

The ECB did not offer any detailed explanation for its move, which caught markets by surprise, but simply said it was now seeking to “assure orderly conditions in the euro money market”. However, it came as several financial institutions, such as BNP Paribas, admitted they had suffered significant losses as a result of investments linked to the credit markets. Many of these are linked to problems in the US subprime mortgage sector.

Bush said he had not seen the report that Beijing was hinting at such a move, in Britain’s Daily Telegraph newspaper, but warned against any attempt by China to hit back at Washington using vast foreign currency reserves.

“That would be foolhardy of them to do that,” Bush said in an interview with Fox News, adding he doubted the report was based on sources from the office of Chinese President Hu Jintao.

“If that’s the … position of the government, it would be foolhardy for them to do this.”

US Treasury Secretary Henry Paulson meanwhile said on CNBC that suggestions that China was considering selling off dollar denominated assets to hammer the already weakened US dollar were “absurd.”

“We have tensions and we have to deal with tensions on both sides … but overall, both of our countries are committed to a constructive economic relationships,” said Paulson, who returned from talks with top leaders in China last week.

China said on Friday it would not be pressured into currency reform as Washington and the US Congress renewed calls for it to speed up changes to make the yuan more market-oriented.

The Telegraph reported that two officials at leading Communist Party bodies had given interviews in recent days warning that Beijing might use more than a trillion dollars in foreign reserves as a political weapon in the event of US sanctions designed to punish Beijing for yuan manipulation.

Described as China’s “nuclear option” in the state media, such a move could trigger a crash of the already-falling greenback and a spike in the US bond yields, which could then dampen the beleaguered housing market and put the world’s richest economy into a recession.

BNP Paribas Investment Partners suspended the calculation of net asset value, the issuance of subsciptions and redemptions in the funds.

The market for ABS – securities backed by assets such as mortgages, loans, leases and credit-card debt – has come under pressure recently as a related consequence of problems in the U.S. subprime mortgage market. BNP Paribas’ move follows similar action this week by WestLB Mellon Asset Management, the asset management joint venture of German state bank WestLB AG and the Bank of New York Mellon Corp. (BK).

BNP Paribas said that “the complete evaporation of liquidity in certain market segments of the U.S. securitization market has made it impossible to value certain assets fairly regardless of their quality or credit rating.”

As a result, the bank said it would suspend three funds – Parvest Dynamic ABS, BNP Paribas ABS Euribor and BNP Paribas ABS Eonia, which are now worth a total of around EUR1.6 billion, down from around EUR2 billion two weeks ago, a spokesman said.

All funds combined at BNP Paribas Investment Partners are worth more than EUR350 billion.

“The situation is such that it is no longer possible to value fairly the underlying U.S. ABS assets in the three above-mentioned funds” and “therefore unable to calculate a reliable net asset value, NAV, for the funds,” the company said.

The bank has been unable to find prices in the relevant parts of the U.S. credit markets since Monday, Alain Papiasse, head of BNP Paribas’ asset management services division told Dow Jones Newswires in an interview.

BNP Paribas Investment Partners, the unit managing the funds, was able to find prices quoted as late as last Friday.

“Since then, liquidity in some parts of the U.S. credit markets has dried up. To be honest, I don’t know why,” Papiasse said. There is no primary issuance and it’s impossible for those seeking to refinance ABS-related funds with any link to the mortgage market to do so, he said.

The valuation of the funds and the issue and redemption process will be resumed as soon as liquidity returns to the market, BNP said.

Concerns Throughout Money Markets

The suspensions sent further shock waves through an already sensitive money market.

“There is a certain degree of herd behavior here,” said Cubillas Ding, analyst at research and consulting firm Celent.

The electric-field therapy was developed by Yoram Palti, a physiologist at the Technion-Israel Institute of Technology, in Haifa, who founded the company NovoCure to commercialize the treatment. Palti’s electric fields cause dividing cancer cells to explode while having no significant impact on normal tissues. The range of electric fields generated by the device harms only dividing cells. And since normal cells divide at a much slower rate than cancer cells, the electric fields target cancer cells. “An Achilles’ heel of cancer cells is that they have to divide,” says Herbert Engelhard, chief of neuro-oncology in the department of neurosurgery at the University of Illinois, Chicago.

Even after chemotherapy, radiation therapy, and surgery, about 85 to 90 percent of glioblastoma patients’ cancer still progresses, and their survival rates are low, says Engelhard. He has about 10 glioblastoma patients enrolled in the trial, which is testing the unusual treatment in patients for whom all other approaches have failed. Engelhard says that the results are encouraging but that it’s too early to comment on the treatment’s efficacy.

The electric fields’ different effects on normal and dividing cells mostly have to do with geometry. A dividing cell has what Palti calls “an hourglass shape rather than a round shape.” The electric field generated by the NovoCure device passes around and through round cells in a uniform fashion. But the narrow neck that pinches in at the center of a dividing cell acts like a lens, concentrating the electric field at this point. This non-uniform electric field wreaks havoc on dividing cells. The electric field tears apart important biological molecules, such as DNA and the structural proteins that pull the chromosomes into place during cell division. Dividing cells simply “disintegrate,” says Palti.

Palti, who for years has been studying the effect of electric fields on cancer and normal cells, says that he has verified this mechanism in computer models and experiments in the lab. “The physics are solid,” says David Cohen, associate professor of radiology at Harvard Medical School.

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It is likely workers at the site – shared between the Institute for Animal Health (IAH) and its commercial partner, Merial Animal Health – were to blame for spreading the disease, the report said.

In a further twist, the HSE said that sabotage at the labs could not be ruled out. Ironically, the Government has just asked Merial to produce 300,000 foot and mouth vaccines.

Politicians and farmers’ leaders were last night asking how such a fundamental breach could occur at a high-security laboratory complex where highly contagious diseases were tested.

Peter Ainsworth, the Conservative environment spokesman, said: “This is truly shocking. It will be very bad news for the farming community, who do so much to make sure they abide by the law.

“This report is devastating in its conclusions and it will be deeply troubling news for farmers, who are always being pushed to improve their bio-security. Yet the labs that are meant to be preventing the disease turn out to be the source of the outbreak.”

Two officials at leading Communist Party bodies have given interviews in recent days warning – for the first time – that Beijing may use its $1.33 trillion (£658bn) of foreign reserves as a political weapon to counter pressure from the US Congress. Shifts in Chinese policy are often announced through key think tanks and academies.

Thousands of soldiers and 500 combat vehicles will take part in “Peace Mission 2007”, organised by the Shanghai Cooperation Organisation (SCO) in the Chelyabinsk region of Russia. Russian officials have also proposed an alliance between the SCO and a body representing most of the former Soviet republics.