The Standard & Poor's 500 index has fallen to its lowest level in nearly 12 years, the latest sign that investors are growing more and more pessimistic about the recession's impact on the global economy.

The benchmark index most watched by Wall Street traders has fallen as low as 749.65, dropping below its November 20 close of 752.44 points.

That was the S&P 500's worst finish since April 14, 1997.

The index regained a little ground in early afternoon and was back up slightly to 754 points.

The S&P 500 remains, at least for now, above the trading low it reached last November 21 - 741.02 points.

Stocks were down broadly at early afternoon Monday, with financial stocks under pressure although the government said earlier in the day it will take more steps to help the banking sector. Technology stocks are also falling after The Wall Street Journal reported that Yahoo Inc's new chief executive is planning a companywide reorganisation.

The Dow Jones industrials were down 136 at 7,229 in early afternoon trading while the Nasdaq composite index was down 16 points at 1,404.

- AP