After cutting interest rates by a quarter percentage point to 1 percent, ECB President Mario Draghi poured cold water on market hopes that the central bank would step up purchases of euro zone sovereign debt or lend money to the IMF to do so.

"This is big a lot of people, stocks, bonds, currencies, had been counting on he ECB and he's basically pulled the rug out from under the market," said Brian Dolan, chief strategist at Forex.com in Bedminster, New Jersey. "There's a sense of shock right now."

"He basically keeps saying there's not going to be any more quantitative easing, so that is obviously concerning the euro bulls right now given the instability over there of their economy.

It's smacking the market pretty good," said David Lutz, managing director of trading, Stifel Nicolaus Capital Markets in Baltimore.

The euro tumbled to $1.3312, the lowest in more than a week, while major stock indexes also fell while bond yields on French and Italian government bonds rose.

European leaders are expected to announce a grand plan to address the crisis on Friday, with France and Germany pushing a plan to amend the EU treaty and tighten budget discipline.