The Dow decreased 329.60 points, or 1.11 percent, to 29,260.81, down about 20.5 percent from its Jan. 4 closing high. The move put the Dow into a bear market, commonly defined by a fall of at least 20 percent from a recent peak.
The S&P 500 slid 38.19 points, or 1.03 percent, to 3,655.04, below its June closing low of 3,666.77.
The Nasdaq Composite Index dropped 65.01 points, or 0.6 percent, to 10,802.92.
Ten of the 11 primary S&P 500 sectors ended in red, with real estate and energy down 2.63 percent and 2.57 percent, respectively, leading the laggards. Consumer staples rose 0.01 percent, the lone gaining group.
The Cboe Volatility Index, widely considered as the best fear gauge in the stock market, surged 7.82 percent to 32.26, following a 9.4-percent jump in the prior session.
Fears mounted that the Federal Reserve would steer the economy into a recession as it attempts to curb price pressures.
Last week, the Fed delivered its third consecutive 75-basis-point rate hike this year and delivered a more pessimistic outlook in their updated economic projections.
For the week ending Friday, the Dow dropped 4 percent, the S&P 500 slid 4.6 percent and the Nasdaq tumbled 5.1 percent.
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