The Dow Jones industrial average tumbled 172.65 points, or 1.29 percent, to finish at 13,167.20, its lowest close since the blue-chip barometer fell below the 13,000 mark Nov. 28. The broader Standard & Poor's 500 Index lost 22.05 points, or 1.5 percent, at 1,445.90.

On the New York Stock Exchange, 581 stocks advanced and 2,605 declined, on volume of 3.6 billion shares.

The technology-heavy Nasdaq Composite Index fell 61.28 points, or 2.32 percent, at 2,574.46.

In London, the FTSE 100 stock index closed down 119.20 points, or 1.86 percent, at 6,277.80.

Japan's Nikkei 225 stock index finished down 264.72 points, or 1.71 percent, at 15,249.79.

The benchmark 10-year U.S. Treasury note rose 23/32 to yield 4.15 percent and the 30-year bond increased 1 6/32, yielding 4.59 percent.

The U.S. dollar fell to 112.94 yen from 113.40 yen in New York late Friday. The euro slipped to $1.4391 from $1.4423.