Persistent worries about the slowing economy and when the Federal Reserve will start tapering its bond buying program had investors on edge again Wednesday.
U.S. stocks fell sharply, extending the previous day's slide, after major global markets also ended in the red.
The Dow Jones industrial average dropped 217 points, or 1.4%, ending below 15,000 for the first time since May 6. The S&P 500 also dropped 1.4% and the Nasdaq declined 1.3%. The day's losses were the worst in almost two months for the Dow and Nasdaq.
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Fed uncertainty dominates: The biggest question mark facing investors is how much longer will the Fed continue to boost the economy.
Comments from various Fed officials over the past few weeks have whipsawed markets as investors try to gauge the central bank's next move.
In its Beige Book report, an analysis of regional economic activity, the Fed described the economic recovery as "modest," "moderate" and "measured."
Investors have also been keeping close tabs on economic data for any additional clues.
Payroll-processor ADP said Wednesday that the private sector added 135,000 jobs in May, less than the 157,000 economists were expecting.
While the weak reading gave investors some hope that the Fed won't pare back its bond buying program anytime soon, nerves remain frayed and investors are taking caution.
The ADP report is a prelude to the U.S. government's closely watched monthly jobs report. That report is due before the bell Friday.
Marc Chandler, strategist for Brown Brothers Harriman, said in a client note that this month's jobs report is "particularly important," given all the rumblings about the Fed's next move.
Other economic news was mixed Wednesday. The ISM services sector expanded more than expected, with the index rising to 53.7 in May from 53.1 the previous month. But factory orders rose just 1%, less than the 1.6% forecast.
What's moving: The day's sell-off was broad-based, with all 10 S&P 500 sectors in the red.
Apple (AAPL) shares slipped after the International Trade Commission ruled that several older Apple products violate a Samsung patent and can't be sold within the United States.
Shares of Toyota (TM) dropped after the automaker recalled nearly a quarter million hybrids to fix brakes.
Related: Fear & Greed Index slides back into neutral
A downer day for global markets: European markets tumbled after a second estimate of first quarter GDP confirmed that the eurozone economy contracted by 0.2%. London's FTSE 100 and the CAC 40 in Paris tanked about 2%, while Frankfurt's DAX fell slightly more than 1%.
Related: Market swings call Japan's Abenomics into question
Asian stocks also ended lower after investors were unimpressed by Japanese Prime Minister Shinzo Abe's unveiling of new "Abenomics" growth policies. The Nikkei index to tumble by nearly 4%, Hong Kong's Hang Seng lost 1% and the Shanghai Composite Index declined by 0.4%.
