Stocks tumbled Friday, giving back all of the gains from the prior session, as worries about the recovery escalated after a pair of reports on the consumer.
In afternoon trading, the Dow Jones Industrial Average was down more than 200 points, or 2.2 percent. The Nasdaq shed 2.2 percent and the S&P 500 dropped 2.4 percent.
The CBOE volatility index, widely considered the best gauge of fear in the market, shot up 25 percent to about 31. With the market's recent rally, the gauge had fallen to near 20.
This came after stocks logged their best day since July on Thursday, with the Dow jumping 2 percent.
The sectors that have led the recent rally pulled back today: Financials, materials and energy were all down more than 3 percent.
All 30 Dow components were lower, led by Bank of America, JPMorgan and Alcoa .
Carl Icahn, who had challenged CIT Group's restructuring, jumped in Friday, saying he would provide an additional $1 billion in credit to the commercial lender.
This came after as CIT reached an agreement with Goldman Sachs to amend a $3 billion loan as part of a plan to restructure debt.
And Citigroup may have to take another $10 billion in write-downsfor deferred tax assets, banking analyst Michael Mayo said.
Some disappointing data on the consumer: Reuters and the University of Michigan reported their gauge of consumer sentiment slipped to 70.6in a final October reading from 73.5 in September.
And the government said consumer spending fell 0.5 percentlast month while income was flat. Separate reports showed employment costs rose and New York City's economic activity continuing to pick up.
Investors shrugged off an encouraging regional report: Business activity in the Midwest expanded in October to the highest level in more than a year, according to the Chicago purchasing managers' index.
On the earnings front, Chevron reported its profit slumped 51 percent but beat expectations as the company pumped more oil out of the ground and prices began to recover.
This came a day after rival ExxonMobilmissed analysts' earnings target.
AIG said on Friday it would not sell its two Japanese insurers.
Intel shares rose and there's been heavy options actionon the stock amid optimism about the chip maker's forecast.
A few more techs delivered upbeat outlooks, including Sony, Panasonic and Samsung.
Sony posted a fourth-quarter loss but cut its full-year loss forecast closer to market expectations, while rival Panasonic showed its first profit in three quarters while raising its forecast.
Las Vegas Sands shares surged after the gambling resort company gained approval for an initial public offering in Hong Kong.
On the political front, the White House will brief media on the status of stimulus spending and jobs, covered by the Recovery Act.
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