Worries over European debt again plagued Wall Street, sending stocks down at the close for a third straight day in a selloff that also hit commodities and energy stocks hard.
The Standard & Poor's 500 and Dow industrialslost about 1 percent each, with energy down nearly 3 percent. All 10 S&P 500 sectors were negative with materials and industrials also getting hammered. Financials and health care were closest to positive territory.
Fears from European debt contagion again ruled the markets.
"It's a chronic disease," said Mitchell Goldberg, president of Client First Strategy in Woodbury, N.Y. "It's going to go on for years, but if we keep the keep the patient alive while the rest of the world has a chance to strengthen itself, then we'll be OK."
However, some big banks erased losses, led by JPMorgan Chase . The KBW Bank Index rose 0.2 percent.
Technology was getting the worst of it, with the Nasdaqoff nearly 1.5 percent.
Losers beat gainers on the Dow industrials about 4 to 1.
Heavy machinery maker Caterpillar led the bluechips lower after it said it would sell a part of its Bucyrus distribution business to the industrial division of Malaysia's Sime Darby for about $360 million.
ExxonMobil and Cisco also pulled down the Dow 30, while General Electric and Merck were the best performers.
In the tech world, Joy Global missed earnings estimates, with profits of $1.82 a share, and issued a cautious guidance that unnerved investors.
Automotive, mining and leisure stocks were among the biggest losers.
Airlines were one of the few positive areas, with United Continental Holdings among the group's leaders.
Gold prices continued their precipitous fall, dropping sharply in morning trade. The yellow metal fell below its 200-day moving average for the first time since January 2009.
Bespoke Investment Group points out that previous dips below the key metric often have been positive for gold.
"Over the following week, month, three months, six months, and one year, the price of gold has averaged gains with positive returns two thirds of the time," Bespoke said in an analysis. "While gold saw negative returns in the three, six, and twelve months following the end of its 1980 and 1988 streaks, following the four remaining streaks the close below the 200-DMA turned out to be a pause that refreshed for gold."
Oil, on other hand, could be in for tougher days.