U.S. stocks fell sharply led by banking and financial institutions such as Capital One Financial, KeyCorp and U.S. Bancorp.Dow Jones Industrial Average fell 155.88, or 1.8 percent, to 8,418.77,Dow's biggest one day selloff in three weeks.Technology led Nasdaq Composite fell 7.76, or 0.45%, to 1731.24.The Standard & Poor's 500 index fell 19.99, or 2.2 percent, to 909.24.
Bank shares plunged, with the KBW Bank (BKX) sector index losing 7.1 percent.Morgan Stanley was down 2.13, or 7.6 percent, to 26.07.KeyCorp declined 69 cents, or 9.9 percent, to 6.28.General Motors shares slumped 10 percent on probable bankruptcy filing.Ford Motor was down 16 cents, or 2.6 percent, to 6.08.
Commodities shares declined as commodities prices pulled back from a recent rally.Chevron, Exxon Mobil,U.S. Steel and Rio Tinto shares all closed lower.
Overseas,Most of Asian and European Markets closed lower.Britain's FTSE 100 was down 0.6 percent, Germany's DAX index down 0.96 percent, and France's CAC-40 slid 1.93 percent.Japan's Nikkei average gained 0.2 percent.Hong Kong's Hang Seng Index was down 1.7%.
U.S. light crude oil for June delivery was down 13 cents to $58.50 a barrel on the New York Mercantile Exchange.COMEX gold for June delivery was down $1.40 to settle at $913.50 an ounce.Dollar gained versus the euro and was down against the yen.