Reuters

LONDON -- World leaders urged U.S. President-elect Barack Obama on Wednesday to help build a new economic order and lead the globe out of its worst financial crisis since the 1930s.

Excitement about the historic election of Obama as the first black U.S. president was tempered by an awareness of the challenges he faces as the world's biggest economy heads toward recession.

"We need to change the current crisis into a new opportunity. We need a new deal for a new world. I sincerely hope that with the leadership of President Obama, the United States of America will join forces with Europe to drive this new deal," said European Commission President Jose Manuel Barroso.

Initial market reaction was lukewarm, with the dollar firming but shares on Wall Street expected to fall as attention focused on a sharp world economic downturn.

European shares were also down 2 percent, while Asian stocks earlier closed at three-week highs.

"The market is maybe reflecting the hard work ahead and difficult economic circumstances new President Barack Obama has inherited," said Keith Bowman, analyst at Hargreaves Lansdown.

Obama does not take office until January, leaving outgoing President George W. Bush to host a summit of world leaders in Washington on Nov. 15 to discuss the global financial crisis that has its roots in the collapse of the U.S. housing market.

That summit will tackle new ways to regulate global financial markets as the world heads into recession.

Authorities are trying to soften the impact of the downturn with support for banks, cheaper lending and stimulus measures, which have already amounted to around $4 trillion.

Germany's Cabinet agreed a package of measures on Wednesday to give Europe's biggest economy a 50 billion euro ($64.2 billion) boost and protect about 1 million jobs, following a 500 billion euro bank rescue package last month.

Gloomy data from Britain and the 15-nation euro zone added to expectations of hefty interest rate cuts on Thursday.

The Bank of England and the European Central Bank are expected to cut their rates on Thursday by at least 50 points, having already cut four weeks ago as part of a coordinated round.

Obama will move quickly to name his top team.

The next treasury secretary, who could be named by Obama within days, will inherit one of the hottest seats in Washington, faced both with guiding the $700 billion economic bailout package and the regulatory reform needed to prevent a repeat of the current crisis.

The shortlist for treasury secretary likely includes former Treasury Secretary Lawrence Summers, former Federal Reserve Chairman Paul Volcker and Timothy Geithner, president of the Federal Reserve Bank of New York.

Obama, whose popular support strengthened on perceptions that he has a better grip on the economic crisis, has advocated a second government stimulus package worth $175 billion that would include money for investments in infrastructure, as well as another round of tax rebates.