Stocks fell sharply in afternoon trade, with all three U.S. indexes briefly down 6% or more. The Nasdaq was down more than 9% earlier as worries about Greece’s debt issues mounted.

The Dow Jones Industrial average fell 8.8% its biggest percentage drop since 1987.

In Toronto the S&P/TSX composite index dropped almost 300 points.

The CBOE Volatility Index, Wall Street’s so-called fear gauge, rose 27% to $31.68, the highest since November 2009.

Major indexes have been in the red throughout the session after the European Central Bank failed to take fresh measures to help stem the Greek debt crisis, cutting deeper into the appetite for risk and putting weak U.S. retail sales into sharper relief.

But almost as soon as markets had plunged, they were on their way back up again, with the Dow rebounding almost to its earlier high.

“It has bounced back a bit but its almost the feeling of 2008 all over again,” said Peter Buchanan, senior economist & strategist, CIBC World Markets.

“Obviously Greece is a matter of concern for some time but one wouldn’t have thought it would have as large an impact as this. Other factors are obviously at play.”

“We can’t see any specific trigger for it at this point, but the volatility has been building in the past few days.”

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