US stocks dropped sharply within minutes of opening on Wall Street Friday, but rallied just as quickly amid widespread uncertainty over the state of the US economy.

The Dow Jones Industrial Average plunged more than 600 points, briefly falling below 8,000 points, before paring nearly two-thirds of those losses. The blue-chip Dow was back to a less than 200 point-loss within 20 minutes of trading opening in New York.

Stocks plummeted on Thursday as US and global moves to shore up financial institutions were unable to reduce fears that a recession was on the horizon. The Dow and broader S&P 500 each fell more than 7 per cent.