NEW YORK -- The Dow plunged nearly 1,200 points, or over 4.4 percent, below the 26,000 psychological level on Thursday as market sell-off continued amid risk-averse sentiment. It was the index's worst one-day point drop in history.

The broader S&P 500 declined 4.4 percent and the tech-heavy Nasdaq dropped 4.6 percent.

All of the 30 Dow component companies closed in red territory, with Microsoft and Dow shedding 7.05 percent and 6.61 percent, respectively, leading the laggards.

All of the 11 primary S&P 500 sectors closed lower. Real estate and energy declined 5.59 percent and 5.47 percent, respectively, the top two laggards.

The Cboe Volatility Index, widely considered the best fear gauge in the stock market, jumped 29.86 percent to 35.79.