NEW YORK, Jan. 24 (Xinhua) -- U.S. stocks took their toll Friday, as investors jittered on heavy selling of stocks and currencies in emerging markets.
The Dow Jones Industrial Average plunged 318.24 points, or 1.96 percent, to 15,879.11. The S&P 500 slipped 38.17 points, or 2.09 percent, to 1,790.27. The Nasdaq Composite Index shed 90.70 points, or 2.15 percent, to 4,128.17.
The Dow and the S&P 500 saw the worst day since June 2013, while the Nasdaq notched the biggest loss not seen since late August.
For the week, the three indices went down 3.5 percent, 2.6 percent and 1.7 percent, respectively.
Before the steep pullback, Wall Street had been struggling for direction since the beginning of this year, in absence of strong upward momentum seen in 2013 when the broad S&P 500 marked a blockbuster increase of roughly 30 percent.
Spooked by weakening economic data and political instabilities in some emerging markets, investors looking for excuses to sell threw in the towel, pulling stocks sharply lower.
The Wall Street diving came on the heels of a broad stock selloff around the world, due to worries over the emerging markets as well as speculations that the U.S. Federal Reserve would further scale back its bond purchases next week.
Asian stocks suffered for a second consecutive day on Friday, followed by equities in Europe, which fell across the board, sending Germany's leading DAX index and France's benchmark CAC 40 to tumble more than 2 percent.
Meanwhile, the Chinese Shanghai Composite Index bucked the trend by increasing 0.6 percent Friday.
The Fed will start a two-day policy meeting beginning Tuesday, and it's expected to continue unwinding its quantitative easing program following an initial reduction of its monthly bond purchases by 10 billion U.S. dollars announced at its December meeting.
Some investors still doubted the credibility of the U.S. central bank in its forward guidance, which had pledged to keep the near-zero interest rates in place for a very long time.
Concerns over the Fed's next move, along with political issues in Turkey, Argentina and Ukraine caused selloff of equities and currencies in these emerging markets, and the effects also spilled over to the global market.
The CBOE Volatility Index, widely considered as a fear gauge of the market, skyrocketed 31.74 percent to 18.14.
In other markets, U.S. oil prices decreased Friday as equities in emerging markets declined on concerns over slower growth.
Light, sweet crude for March delivery moved down 68 cents to settle at 96.64 dollars a barrel on the New York Mercantile Exchange, while Brent crude for March delivery gained 30 cents to close at 107.88 dollars a barrel.
Gold futures on the COMEX division of the New York Mercantile Exchange rose Friday, with the most active gold contract for February delivery up 2 dollars to settle at 1,264.3 dollars per ounce, as a big correction in stocks helped lure investors to the precious metal.
The U.S. dollar traded mixed against major currencies Friday ahead of the Fed's widely watched policy meeting next week.
In late New York trading, the euro fell to 1.3677 dollars from 1.3698 dollars of the previous session, and the dollar bought 102. 30 Japanese yen, lower than 103.18 yen of the previous session.