Stocks dropped sharply on Thursday, with the Dow losing over 170 points and extending losses for a third session, after disappointing U.S. and Chinese manufacturing data sparked concerns for global growth.
Wall Street's drop stems largely from worries about China, "as far as economic growth is concerned, and the potential for it to lead to pressure on loans they have outstanding; that's weighing on the market," said Robert Pavlik, chief market strategist at Banyan Partners.
And, "earnings season is not proving all that much help right now. It's not terrible, but it's not outstanding. People are looking for this long overdue correction, so this is early kindling to that potential fire," Pavlik added.
After a 195-point drop earlier in the session, the Dow Jones Industrial Average closed unofficially down 175 points, or 1.07 percent.
The S&P 500 declined 16 points, with the financial sector hardest hit and telecommunications the sole sector rising.The Nasdaq lost 24 points.
"While there is a lot of optimism for global growth in 2014, the picture still looks muddied, especially in emerging markets which is where the real growth alpha has come from," emailed Peter Boockvar, chief market analyst at the Lindsey Group.
U.S. manufacturing growth slowed in January, according to data released by Markit.
Asian stocks fell after a Chinese gauge of manufacturing fell to 49.6 from 50.5, weaker than expected. Conversely, a euro-area manufacturing index climbed to 53.9 from 52.7 in December.
Shares of Herbalife fell nearly 13 percent after Reuters reported a U.S. senator was calling for a probe of the nutrition company, which has been accused of running a pyramid scheme by hedge-fund manager William Ackman.
Netflix jumped after it forecast customer growth that beat expectations; McDonald's shares wavered after the fast-food chain and Dow component reported weaker-than-expected quarterly revenue.
The dollar fell against other currencies and the 10-year Treasury yield dropped 6 basis points to 2.807 percent.
Crude-oil futures rose 68 cents, or 0.7 percent, to $97.41 a barrel, and gold rose $20.30, or 1.6 percent, to $1,258.90 an ounce.
Labor Department data showed that applications for U.S. jobless benefits last week rose by 1,000 to 326,000, holding close to a six-week low.
Another report had existing homes sales totaling 4.87 million in December versus a 4.94 million estimate.