The fate of the rescue plan, passed by the Senate 74-25 on Wednesday night, now lies with the House of Representatives, which is expected to vote on the bill on Friday.

The House rocked global markets on Monday by rejecting an earlier version of the bailout, which President George W. Bush has called the "essential to the financial security of every American."

European Central Bank President Jean-Claude Trichet said economic activity was weakening in Europe and opened the door to interest rate cuts, while in the United States data suggested a recession may be approaching.

U.S. factory orders fell 4 percent in August, on top of data on Wednesday that showed manufacturing activity in September at its weakest since the 2001 recession.

U.S. jobless claims rose last week to their highest level in seven years, ahead of September payrolls data due out on Friday.

Oil prices fell almost US$3 a barrel on an expected slowdown in economic activity around the world. The dollar rose to a year high against the euro after Trichet's comments and major U.S. stock indexes fell more than 2 percent.

At the Paris Auto Show, top automakers including General Motors Corp and Ford Motor Co warned of tough times, as evaporating credit for consumers cuts demand and could force production cuts and job losses.

"The problems of subprime and credit crunch are now all over the world," Ford Chief Executive Alan Mulally said. "The downturn is longer and deeper than we foresaw a year ago," he said.

In a week marred by bank rescues across Europe, French President Nicolas Sarkozy's office said he would host the leaders of Britain, Italy, Germany and the ECB on Saturday to discuss a response to the credit crisis. Sarkozy denied reports a 300 billion euro (US$415 billion) plan akin to the U.S. bailout was under consideration.

Market participants remained cautious about the U.S. bailout bill's prospects in the House.

"I'm not betting anything here because I don't know what the House is going to do," said Paul Mendelsohn, chief investment strategist at Windham Financial Services in Charlotte, Vermont. "If this bill doesn't pass in the House, it's game over."

Even if the bill is passed, worries remain over the global economic outlook, said Masamichi Adachi, senior economist at JPMorgan in Tokyo. "It's a completely different world now. All the things U.S. authorities are doing now are simply aimed at preventing a global meltdown."

"STILL UNCERTAIN"

The bailout plan, equivalent to some US$2,300 per American, is intended to reinvigorate credit markets and interbank lending that has frozen up while overleveraged financial institutions staggered under the weight of failed mortgages.

It has stirred fierce criticism from those who see it as help for a Wall Street guilty of taking reckless risks in pursuit of short-term profit.

Under the deal, the Treasury would take on illiquid assets held by banks, in the hope of restoring confidence and unfreezing credit markets vital to the wider economy.

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