As the crisis in Japan moved from natural disaster to potential nuclear meltdown, investors around the world weighed the mounting economic and financial uncertainty.

Japanese authorities removed emergency workers from the third reactor at Fukushima Daiichi Nuclear Power Station following an explosion there on Tuesday morning, which damaged a containment structure and raised the odds of greater radioactive emissions. Without workers on hand, the odds of a meltdown appeared to be higher. However, water levels in the reactor began to rise later in the day, and radiation levelsbegan to fall.

Equity markets around the world declined amid fears that the earthquake and tsunami that hit the country on March 11, damaging nuclear power facilities, will slow economic growth and hurt asset prices. On Tuesday, Japan’s Nikkei 225 index fell 10.6 percent, extending a 6.2 percent loss on Monday. It was the deepest two-day drop since 1987. Stocks in many other markets around the world declined too. S&P 500 futures fell 2.8 percent in New York on Tuesday morning. The S&P 500 fell 0.6 percent on Monday. Treasury prices rose.

Japanese stocks are high, relative to global markets. And many experts believe that U.S. equities may be due for a correction as well. The crisis in Japan, compounding geopolitical risks in the Middle East, could affect equity values for an indeterminate amount of time.

“Since Japanese equities have been out-performing global equities year to date, we believe recent events will prompt profit taking and expect investors to remain on the sidelines near term until there is greater clarity on the repercussions of the disaster on prices and on the outlook for oil prices,” Goldman Sachs analyst Kathy Matsui said in a note to investors.

“It’s a negative for equity markets,” says Eric Lascelles, chief economist at RBC Global Asset Management.

Manufacturers from autos, to semiconductors and steel have temporarily shut down operations in parts of Japan. That has disrupted the flow of goods around the world. Japan’s semiconductors are used in Apple Computer products and South Korean consumer electronics. Shipbuilders in South Korea count on steel from Japan. Consumers and auto dealers around the world will be feel the brunt of auto plant shutdowns in Korea. And luxury goods makers are expected to lose business as exports to Japan slow down. Shares of Burberry Group fell 4.3 percent.