Relentlessly gloomy reports about the health of the world economy rocked Wall Street on Thursday, stirring more worry about the stalled recovery and sending the stock market to its second-worst decline this year.

The bad economic reports kept piling up: Manufacturing slumped in China. A closely watched unemployment figure jumped to its highest level in nine months. Sales of previously owned homes fell. Then came word of a sharp contraction in Northeast manufacturing, the worst since last August.

Suddenly, the outlook turned so bad that a Goldman Sachs analyst told clients to place bets against the stock market.

"The news has been horrible out there," said Uri Landesman, president of Platinum Partners. "The U.S. economy is slowing down. And China's growth is definitely under question."

The Dow started sinking after the Philadelphia branch of the Federal Reserve reported a manufacturing slowdown resulting from a steep drop in companies' orders. Then the losses just accelerated.