NEW YORK, Nov 21, 2007 (AFP) - US stock markets opened sharply lower Wednesday as crude oil prices threatened to smash 100 dollars a barrel and as the ailing dollar slumped to another record low against the euro.

The Dow Jones Industrial Average shed 104.21 points (0.80 percent) to 12,905.93 just after the opening bell was rung on the New York Stock Exchange.

The tech-rich Nasdaq composite lost 29.94 points (1.15 percent) to 2,566.87 and the Standard & Poor's 500 broad-market index fell 12.43 points (0.86 percent) to 1,427.27.

Traders said the oil price spike and weaker dollar dragged down stocks.

Oil prices, which struck 99.29 in New York, have soared in part because of the weakening dollar which makes oil cheaper for speculators holding stronger currencies.

The dollar came under renewed pressure as the euro struck an all-time high of 1.4855 dollars. The dollar stumbled after the US central bank scaled back its growth projections for the US economy on Tuesday citing the housing market downturn.

And in a Wall Street Journal online interview, published Wednesday, Treasury Secretary Henry Paulson warned that potential mortgage defaults "will be significantly bigger" in 2008 than this year.

Paulson's bleak assessment comes after US mortgage giant Freddie Mac on Tuesday blamed a 2.0 billion dollar loss on housing market woes and tighter credit markets.