ECONOMY

US stocks swoon, extending market losses, as traders dump risky assets and favor bonds

In this Oct. 8, 2014 photo, an American flag flies in front of the New York Stock Exchange in New York. U.S. stocks are plunging in early trading Wednesday, Oct. 15, 2014, as traders flee risky assets. (AP Photo/Mark Lennihan)

In this Oct. 8, 2014 photo, an American flag flies in front of the New York Stock Exchange in New York. U.S. stocks are plunging in early trading Wednesday, Oct. 15, 2014, as traders flee risky assets. (AP Photo/Mark Lennihan)  (The Associated Press)

Stocks are falling sharply as traders dump risky assets and park their money in investments seen as relatively safe, such as U.S. government bonds.

The Dow Jones industrial average was down 272 points, or 1.7 percent, to 16,042 as of 11:51 a.m. Eastern time Wednesday. It plunged as much as 369 points shortly after trading began.

The Standard & Poor's 500 fell 32 points, or 1.7 percent, to 1,845. The Nasdaq fell 60 points, or 1.4 percent, to 4,167.

All three indexes are now negative for the year. The S&P is down 8 percent from its record high reached Sept. 18.

Bond prices soared as investors shifted money into safe-haven investments.

The yield on the 10-year Treasury note plunged to 2.03 percent from 2.20 percent Tuesday, a huge move.