Argentina's President Cristina Fernandez has signed a bill that will nationalise the country's 10 private pension funds.
The move will put the government in control of almost $US30 billion of investments and is aimed at protecting them from the global market turmoil.
Shares slumped amid fears of the move's impact. Critics accused the government of trying to grab the funds ahead of a tough budget year.
The bill needs the backing of Congress, where the ruling party has a majority.
President Fernandez said that Argentina needed to protect those with pensions amid falling stock prices around the world.
As the 10 private pension funds are the country's largest institutional investors, the announcement also hit the value of the peso and Argentine bonds.
The main stock market index fell 16.17% to 877.43 points.
Union leaders welcomed the nationalisation move. Commissions on the pensions and the lack of a guaranteed minimum pension have made the private system unpopular with many Argentines.
Congress, controlled by Ms Fernandez's Front for Victory political grouping, will debate the bill next week.
Some analysts saw the move as a tactic by the government to get hold of cash to help service the national debt of some $US150 billion. Argentina defaulted on its debt in 2001.