Stocks dropped on Tuesday, the first trading day of the fourth quarter, as disappointing manufacturing data stoked worries over the U.S. economy.
The Dow Jones Industrial Average closed 343.79 points lower, or 1.3% at 26,573.04 after rallying more than 100 points earlier in the day. The S&P 500 slid 1.2% close at 2,940.25. The Nasdaq Composite was down 1.1% at 7,908.68.
The Institute for Supply Management said U.S. manufacturing activity contracted to its worst level since June 2009. The ISM report follows the release of weak manufacturing data from Europe.