Stocks Battered by Global Downdraft

Meanwhile, U.S. equities weren't the only asset class in deep trouble during the final session of the week. Crude oil was dropping $3.23 to $64.61 a barrel, despite an announcement by OPEC that it would reduce production by 1.5 million barrels a day in an effort to support falling prices. Gold was losing $1.30 to $713.40 an ounce.

After rocketing ahead in early action, longer-dated U.S Treasury securities were off their highs. The 10-year note was up 16/32, yielding 3.62%. The 30-year was gaining 20/32 to yield 4.01%.

Overseas, European indices, such as London's FTSE and Frankfurt's DAX, were falling sharply. In Asia, the Nikkei in Japan and the Hang Seng in Hong Kong closed with significant losses.

The foreign exchange market was seeing monumental moves in some cases, with the dollar registering significant changes against its major counterparts. The euro was losing 1.4% to $1.27, and the pound was sinking 2.6% to $1.57. The Australian dollar was off 8.5% against the greenback.

However, the dollar was surrendering 3.1% to the yen.

Lending markets slowed a trend of loosening that had emerged in previous sessions. Three-month dollar Libor, a measure of the rate banks charge one another for large loans, was down slightly at 3.52%. The cost of overnight borrowing rose 7 points to 1.28%.

In company news, PNC Financial Services (PNC Quote) and National City (NCC Quote) announced a merger agreement. PNC will buy National City for $5.2 billion, $2.23 a share in a cash-and-stock deal.