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Interest rate concerns prompted the Bank of Japan to ready more than $220 billion, but the markets continued to set the pace in a troubling day of trading in the wake of the Japanese earthquake and tsunami - dropping nearly 10% in one day.

On the Tokyo Stock Exchange, the benchmark Nikkei-225 stock index took it on the chin, closing down more than 10 percent after pruning some intraday losses triggered largely by rising radiation leaks Tuesday at the quake-tsunami damaged Fukushima nuclear power plant where a third explosion early Tuesday hit the No. 2 reactor.

Nikkei's close at 8,605.15 points came on the heels of Monday's loss of 6.2 percent. In early trading Tuesday, the index had plunged more 14 percent after reports of the reactor explosion, the third such. On Monday, a hydrogen explosion hit the No. 3 reactor, the largest in the plant complex and the first explosion Saturday was at the No. 1 reactor.

Acting quickly for the second straight day, the Bank of Japan announced another massive 20 trillion yen or $245 billion in various emergency funding as the country reeled under the impact of last Friday 9-magnitude earthquake and the gigantic tsunami it unleashed which killed thousands, left thousands more missing, destroyed vast stretches of northeastern Japan and set off a major nuclear crisis.

The central bank's offer to money markets came a day after a similar offer involving an immediate injection of 15 trillion yen.

The efforts are designed to restore confidence in the economy, prevent interest rates from rising, and ensure enough liquidity so banks and other financial institutions have sufficient funds to make loans to companies and families.

Responding to Tuesday's explosion at the nuclear plant, Prime Minister Naoto Kan told the nation the risk of further releases of radioactive material from the plant remained "very high," CNN reported.

Other Asian markets also were down, with the U.S. markets expected to open lower.

In other developments, the Wall Street Journal reported Japan's top automakers planned to halt domestic operations through Wednesday as they faced supply shortages due to power cuts and other problems.

Other major industries also faced similar constraints.

Source: UPI