UPDATE | Dow down more than 650 points

Associated Press

U.S. stocks slumped today, pulling down the Dow Jones industrial average by more than 650 points and handing the market its worst week in two years.

Technology, banks and energy stocks accounted for much of the broad slide. Several major companies, including Exxon Mobil and Google's parent company, Alphabet, sank after reporting weak earnings.

Fears of rising inflation sent bond yields higher and contributed to the stock market swoon after the government reported that wages grew last month at the fastest pace in eight years.

The sharp drop follows a long period of unprecedented calm in the market. Stocks haven't had a pullback of 10 percent or more in two years, and hit their latest record highs just one week ago.

"We've enjoyed low interest rates for so long, we're having to deal with a little bit higher rates now, so the market is trying to figure out what that could mean for inflation," said Darrell Cronk, head of the Wells Fargo Investment Institute.

The increase in bond yields hurts stocks in two ways: it makes it more expensive for companies to borrow money, and it also makes bonds more appealing to investors than riskier assets such as stocks.

The Standard & Poor's 500 index fell 59.85 points, or 2.1 percent, to 2,762.13. That's the biggest loss for the benchmark index since September 2016. The S&P 500 has lost 3.9 percent since hitting a record high a week ago.

3:23 p.m.

Associated Press

U.S. stocks slumped big time today, pulling down the Dow Jones industrial average by more than 600 points and placing the market on track for its worst week in two years.

Technology and energy stocks accounted for much of the broad slide as several major companies, including Exxon Mobil and Google's parent company, Alphabet, sank after reporting weak earnings.

Investors have grown increasingly worried that a rapid rise in interest rates, spurred by higher inflation, could derail the market's strong and calm ride upward. And they're concerned the Federal Reserve will respond to higher inflation by raising interest rates more quickly than expected.

The yield on the 10-year Treasury note, a benchmark for many kinds of loans, including mortgages, climbed to 2.85 percent Friday, the highest level in roughly four years. The rate was at 2.41 percent four weeks ago and 2.66 percent on Monday.

The prospect of higher interest rates, which can weigh on company earnings and stock prices, derailed the market's strong start to 2018, pulling the indexes lower for much of this week.

"We've enjoyed low interest rates for so long, we're having to deal with a little bit higher rates now, so the market is trying to figure out what that could mean for inflation," said Darrell Cronk, head of the Wells Fargo Investment Institute. "The concern for the stock market is as interest rates go up so does the cost of debt service, the discount rate that you would use in factoring earnings growth for companies."

The Standard & Poor's 500 index fell 58 points, or 2.1 percent, to 2,763 as of 3:07 p.m. Eastern Time. That's the biggest loss for the benchmark index since September 2016. The S&P 500 has lost 3.8 percent since hitting a record high a week ago.

2:48 p.m.

BULLETIN: NEW YORK (AP) — Dow Jones industrial average fell 500 points, extending a weeklong slump.