Stocks closed out the final trading day of October with a thud, finishing near session lows amid renewed concerns over the European debt crisis, but logged some record gains for the month.
The Dow Jones Industrial Average plunged 276.10 points, or 2.26 percent, to finish at 11,955.01, led by Bank of America and Alcoa.
The S&P 500 tumbled 31.79 points, or 2.47 percent, to end at 1,253.30. And the Nasdaq fell 52.74 points, or 1.93 percent to close at 2,684.41. The CBOE Volatility Index, widely considered the best gauge of fear in the market, jumped near 30.
All key S&P sectors finished heavily in the red, led by materials and energy.
Despite today's weak session, the major averages posted some impressive gains for the month. The Dowis posted its best monthly point gain on record and its best monthly percentage gain since October 2002. The S&P 500 logged its best monthly gain since December 1991, while the Nasdaq posted its best month since last September.
“November from a historical standpoint is not a bad time to put money to work in the market…we tend to rally into the end of the year,” said Tom Schrader, managing director for U.S. Equity Trading at Stifel Nicolaus. “Today, we’re down on Chinese concerns on how they might not participate [in helping the EU] so you’ve got to pay attention to that.”
China's President Hu Jintao said he believes Europe has the ability to overcome its economic problems and gave no indication whether Beijing could play a rolein helping solve the euro zone's debt crisis.
MF Global Finance filed for Chapter 11 bankruptcy protection, after a failed attempt to sell itself to Interactive Brokers Group. The shares have been halted since this morning after the New York Federal Reserve earlier suspended the firm from doing business with them.
The dollar hit a three-month highversus the Japanese yen, following the intervention by the Bank of Japan. The day's increase is the biggest one-day move by the dollar against the yen in almost three years.
The dollar gain put a pressure on commodities, with shares of Freeport-McMoran and Rio Tinto falling more than 5 percent each.
Among earnings, Barclays slipped even after the European bank reported a 7 percent gain in net profit in the first nine months, helped by a one-time boost from investment banking.
Humana was the best performer on the S&P 500 after the health insurer posted a higher-than-expected profit and also boosted its full-year earnings forecast.
Allstate and Anadarko Petroleum are slated to post earnings after-the-bell tonight.
On the economic front, business activity in the Midwest decelerated in Octoberas new orders fell. The Institute for Supply Management-Chicago business barometer slipped to 58.4 from 60.4 the month before, falling short of expectations of 59.0, according to a Reuters poll.
Bank of America and Wells Fargo are among stocks to watch, following the announcement that Wells Fargo is canceling a planned monthly debit card usage fee, while BofA is scaling back similar plans. The fees have been the subject of protest by consumers.
Sony is announcing plans to split its struggling TV business into three separate units, focusing on LCD TVs, outsourcing, and next-generation TVs.
Also on the economic front, investors will be focused on the meeting of the Federal Reserve's policy-setting committee. While the committee is expected to maintain Fed fund rates unchanged, investors will be closely watching for any clues the Fed may give on the outlook of the economy.
In addition, the government's October employment report is scheduled to be released at the end of the week.
—Follow JeeYeon Park on Twitter: twitter.com/JeeYeonParkCNBC—
On Tap This Week:
TUESDAY: ISM mfg index, construction spending, FOMC meeting begins, auto sales, new CEO at JCPenney; Earnings from Pfizer, Credit Suisse, Dollar Thrifty, Sirius XM Radio
WEDNESDAY: Weekly mortgage apps, Challenger job-cut report, ADP employment report, oil inventories, FOMC mtg announcement, Bernanke press conference; Earnings from Comcast, Clorox, MasterCard, Nissan, Sony, Time Warner, Kraft, Qualcomm, Transocean, WholeFoods
THURSDAY: Jobless claims, productivity and costs, Fed's Lockhart speaks, factory orders, ISM non-mfg index, G20 Summit, chain-store sales, Groupon IPO prices; Earnings from Unilever, Kellogg, AIG, CBS
FRIDAY: Non-farm payroll report
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