The Dow Jones Industrial Average closed below 20,000 on Wednesday, at one point wiping out all of the gains from the Trump era before recovering slightly.
The blue-chip index fell more than 1,300 points, or 6 percent, while the benchmark S&P 500 slipped 5 percent and tech-heavy Nasdaq Composite lost just less than that.
Some of the selling abated during the final minutes of trading as lawmakers worked to pass stimulus measures.
Earlier Wednesday, trading was halted for the second time this week, as the S&P tumbled 7 percent amid investor worries that the COVID-19 pandemic has slowed the U.S. economy to a near standstill.
Amid the volatility, U.S. exchanges vowed to remain open.
The selling comes as the Trump administration and Congress continued to work toward hammering out the details of a $1 trillion stimulus package designed to prop up the most harshly pummeled sectors of the U.S. economy and give cash to people out of work.
Looking at stocks, Boeing shares were rocked as the company called for a $60 billion bailout for aerospace manufacturers.
Airlines, restaurants, hotels and casino operators remained under pressure as the Trump administration weighs assistance for the industries hit hardest by the pandemic.
Meanwhile, plunging oil prices hammered energy giants ExxonMobil and Chevron and weighed heavily on Hess Corp. and Continental Resources. West Texas Intermediate crude oil settled at an 18-year low of $20.37 a barrel, down 24.4 percent.
Miners slid as the price of an ounce of gold slipped 3.1 percent to $1,477.30.
On the earnings front, FedEx fell after announcing its adjusted net income dropped 53.5 percent from a year earlier to $371 million and suspending its 2020 profit outlook due to uncertainty caused by the COVID-19 pandemic.
General Mills raised its adjusted profit forecast, but its shares declined nonetheless.
The yield on the 2-year note rose 0.069 bps to 0.522 percent while the yield on the 10-year note rose 0.265 bps to 1.259 percent.
The steeper curve was unable to give relief to banks, which continued to see their share prices sink.
Winners were few and far between, with meal-delivery service Blue Apron among the only bright spots.
The company's shares soared as investors speculated that it would benefit from restaurants closing their dining rooms. Shares were already up 187 percent this week through Tuesday.
European markets were sharply lower, with France’s CAC falling 5.9 percent, Germany’s DAX sliding 5.6 percent and Britain’s FTSE tumbling 4.1 percent.
Hong Kong’s Hang Seng paced the decline in Asia, falling 4.2 percent, while China’s Shanghai Composite and Japan’s Nikkei fell 1.8 percent and 1.7 percent, respectively.