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Stock risk warning

THE World Bank chief said that the slump in investor confidence was feeding through to developing nations.

Robert Zoellick (right) said that advanced economies need to take "cooperative action" as stock markets in developing countries had been hit and capital flows had declined sharply.

"So far, foreign direct investment to developing countries has held up, which is good, but we need a close watch," he said.

"A new and larger risk looms. The drop in markets and confidence could prompt slippage in developing countries' investment and a pull-back by their consumers, too."