(CBS/AP) The European Commission on Tuesday urged the United States to show "statesmanship" in the financial crisis for sake of world economy.

EU Commission spokesman Johannes Laitenberger said the EU was disappointed the U.S. House of Representatives rejected the $700 billion rescue package for the financial markets and added Washington had a "special responsibility" toward the global economy.

Europe's half-plea-half-demand came after a turbulent morning for markets around the globe, as weary investors tried desperately to read the tea leaves left on the abandoned negotiating table on Capitol Hill.

Unsure when U.S. lawmakers might pass legislation to shore up the floundering American financial markets, traders across the globe threw shares overboard at their respective trading floors opened.

Much of the initial loss was recouped later in the day, as traders moved to snap up shares deemed oversold and undervalued.

With the House not scheduled to meet again until Thursday, congressional leaders and Bush administration officials promptly sought to assess what types of changes could win over enough votes to guarantee success.

U.S. President George W. Bush planned to make a statement on the rescue plan at 8:45 a.m. EDT Tuesday.

Britain's benchmark stock index, the FTSE 100, fell by as much as 3 percent in early trading, with particularly sharp declines in the banking sector. But the index of 102 companies then recovered, trading down only 0.15 percent at 4,811.33 by late morning.

Germany's benchmark DAX index fell by nearly 1 percent to 5,756.87, while the Paris CAC-40 was barely down 0.20 percent at 3,946.00. Meanwhile, Russia's regulator was forced to halt regular trading in its two major markets on Tuesday morning after stocks plunged in the opening minute of trading.

In Ireland, however, the government successfully bucked the downward trend by guaranteeing all the deposits and borrowings - worth around 500 billion euros (US$717 billion) - of six of the country's major lenders. Ireland's ISEF Index of financial shares surged by as much as 25 percent on the back of the guarantee, before settling to a rise of 12 percent by midmorning.

Some analysts were crediting Ireland's unprecedented move with helping to keep European stocks overall from falling nearly as much as stocks in the United States and Asia did.

"The Irish government's blanket insurance could form a template for a European approach to this crisis," said Rob Carnell, London-based chief international economist at ING Financial Markets.

In Asia, most major stock markets fell Tuesday in stunned dismay over U.S. lawmakers' rejection of the bailout plan.

Markets across Asia tumbled sharply as they opened amid fears that the setback could lead to a broader global financial crisis. But as trading progressed, many indices erased losses and Hong Kong's market staged a dramatic turnaround to close slightly higher as investors scooped up beaten-down shares.

Japan's benchmark Nikkei stock 225 index slumped 4.12 percent to close at 11,259.86 - the lowest level since June 9, 2005. In Australia, the S&P/ASX-200 index fell 4.3 percent after falling as much as 5.3 percent.

The bailout bill's failure dealt a "severe blow to Asia markets right after the Lehman shock," said Mitsushige Akino, fund manager at Ichiyoshi Investment Management in Tokyo, referring to the collapse earlier this month of the U.S. investment bank.

"Many investors grew even more cautious because of the latest development over the bill, and they only see passage of the bill as a minor improvement to the crisis," he said.

Some markets bounced back. Hong Kong's Hang Seng index gained 0.76 percent to close at 18,016.21 after earlier plunging more than 5 percent. India's Sensex was up 2.4 percent in afternoon trading.

Investors were stunned by the U.S. House of Representatives' rejection Monday of a $700 billion emergency bailout package that would have allowed the government to buy bad mortgages and other sour assets held by troubled banks and other financial institutions.

With elections in November, many lawmakers were unwilling to take the political risk of supporting a measure that many American voters see as an undeserved bailout for rich, reckless investment bankers.

"This is a bad development," Australian Prime Minister Kevin Rudd told reporters in Australia's capital, Canberra. He urged U.S. lawmakers to urgently return to negotiations to come up with a deal that will prevent further infection of world markets.

In New York, the Dow Jones industrial average plunged 777 points, its biggest ever single-day drop, or nearly 7 percent, to 10,365.45, its lowest close in nearly three years.

Japanese Prime Minister Taro Aso urged the country's financial officials to closely monitor the situation and take appropriate measures to protect the world's No. 2 economy, according to Kyodo News agency.

"We have to respond appropriately in order not to affect the Japanese economy and to prevent the financial system from falling apart," Aso was quoted as saying.

Japan's banks have relatively little exposure to the bad mortgages at the core of the global credit crisis, but investors are worried that a slowdown in the U.S. and global economy will hurt demand for exports.

The Bank of Japan on Tuesday morning pumped another 3 trillion yen (US$28.7 billion) into money markets, as part of efforts by central banks worldwide to boost liquidity and bolster interbank lending. That brings the BOJ's total injection to 21 trillion yen (US$200.6 billion) since the collapse of Lehman Brothers Holdings Inc. earlier this month.

The chaos sapped the dollar overnight. The greenback was trading at 104.32 yen Tuesday afternoon in Asia from above 106 yen a day earlier, adding further pressure on major exporters.

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