The Dow plunged nearly 300 points and barely avoided making a new six-year low Tuesday as the markets continue to worry the government's rescue efforts won't stop the nation's economic bleeding any time soon. 

Today’s Markets

The Dow Jones Industrial Average fell 297.81 points, or 3.79%, to 7552.60, the S&P 500 lost 37.67 points, or 4.56%, to 789.17 and the Nasdaq Composite sank 63.70 points, or 4.15%, to 1470.66. The consumer-friendly FOX 50 declined 24.59 points, or 4.01%, to 588.82.

The latest selloff illustrates how confused the markets remain about the Treasury Department’s latest financial rescue plan and how skeptical many are about the speed of the $787 billion stimulus package President Barack Obama signed into law on Tuesday. 

“We are concerned that the three-pronged approach -- stimulus package, financial rescue and foreclosure initiatives -- is just going to take a whole lot longer than we thought a month ago. That should've been something we wrapped our arms around a while ago,” said Art Hogan, chief market strategist at Jefferies & Co.

By a fraction of a point, the Dow ended above the crucial 7552.29 level at which the benchmark index settled in November for the first time since 2003. Since hitting a record high of 14164 in November 2007, the Dow has lost 46.7% of its value, including a drop of 13.9% in 2009 alone. The S&P 500, which traders follow more closely, fell below the crucial 800 level Tuesday to the lowest level since Nov. 20.

“We just aren’t sure that everything the government is doing is going to be quick enough to bail us out of the trouble we are in,” said Ryan Detrick, equity analyst at Schaeffer’s Investment Research. “We’re in the camp that November was not the lows and we do think this market is going to continue to go lower. The problems are still there.”

Aside from considerable uncertainty about the action in Washington, the markets were also under fire on Tuesday from a $3 dive in oil prices, another bleak manufacturing report, plunging global stocks and another bad day for the financials. 

Nearly all 30 components of the Dow fell by at least 1%, led by General Motors (GM) and Citigroup (C). Financial giants Bank of America (BAC) and JPMorgan Chase (JPM) also fell sharply. Wal-Mart, which released better-than-expected earnings, was the only blue-chip component ending in the green. 

Economy, Big 3 in Focus

Underscoring the continued lack of clarity on the bailout plan that was released last week, financial stocks tumbled again on Tuesday, falling another 10% as a sector. Regional banks like Huntington Bancshares (HBAN) and Fifth Third Bancorp (FITB) fell even further. 

Economic fears were bolstered Tuesday morning by the Federal Reserve Bank of New York’s Empire Manufacturing Survey, which plunged to a record low of -34.65 in February, underscoring the weak economy.

After being closed a day ago for Presidents Day, Wall Street was also catching up with the global markets, which fell broadly on Monday after Japan said its GDP plunged by almost 13% in the fourth quarter from the year before. The selling overseas continued on Tuesday as the FTSE 100 tumbled to its lowest level since Nov. 21 and the Dow Jones Euro Stoxx 50 hit new 5 1/2-year lows. 

Meanwhile, General Motors (GM) and privately held Chrysler LLC were racing to receive major concessions from bondholders and the United Auto Workers union ahead of a Tuesday deadline to file viability plans with the government. The White House, which has scrapped the idea of a “car czar” to head up the negotiations, told reporters on Tuesday it has not ruled out a government-backed bankruptcy for the struggling auto makers, which have already received $17.4 billion in loans. 

Crude Plunges, Gold Soars

In the commodity markets, crude oil futures fell sharply, ending in the red for the sixth day of the past seven. The price of a barrel of crude fell $2.58 to settle at $34.93, giving back most of Friday's big gains.

In a dramatic flight to safety, gold prices soared Tuesday to fresh seven-month highs, jumping $25.50 per ounce to $967.00. Gold is trading less than $40 away from its all-time high of $1,003 per ounce, set March 2008. 

Corporate Movers

Sirius XM Radio (SIRI) staved off bankruptcy thanks to a $530 million loan from Liberty Media (LINTA), which will receive a 40% stake and seats on the Sirius board in return. Sirius had reportedly been in talks with satellite mogul Charles Ergen, who controls a significant amount of Sirius debt that matures on Tuesday.

Trump Entertainment Resorts (TRMP) filed for Chapter 11 bankruptcy protection days after Donald Trump, the casino operator’s chairman, resigned. The company listed assets of $2.1 billion and total debts of $1.74 billion.

Wal-Mart (WMT) beat the Street with adjusted-earnings of $1.03 per share as sales rose 6%. The world’s largest retailer also gave an in-line profit guidance for the new fiscal year and first quarter.

Bank of America (BAC) said it has made a $402 million dividend payment to the U.S. as part of the government’s $700 billion Troubled Asset Relief Program.

Research in Motion (RIMM) settled a stock-options backdating probe with the SEC as four of the BlackBerry maker's execs agreed to pay $2.3 million without admitting or denying the allegations.

Daimler (DAI) posted a steeper-than-expected pre-tax loss of $2.47 billion amid heavy losses from its Chrysler investment and sinking sales at Mercedes-Benz. 

Smithfield Foods (SFD) released plans to cut 1,800 jobs and shutter six plants, sending shares of the world’s largest pork processor  lower.

Deere (DE) fell sharply after Goldman Sachs downgraded the largest farm equipment maker in the world to “sell.” Goldman said Deere could slash its 2009 profit guidance by 10%.

Medtronic (MDT) beat the Street with an adjusted-profit of 71 cents per share as the medical-device maker’s revenue grew 3% to $3.5 billion.

Global Markets

European markets took heavy losses as the Dow Jones Euro Stoxx 50 index, which gauges the 50 largest companies in Europe, fell 3.36% to its lowest level since April 2003 and London's FTSE 100 dropped 2.43% to territory unseen since Nov. 21. 

In Asia, worries about the Hong Kong banks and the resignation of the Japanese finance minister sent shares sharply lower overnight. Japan's Nikkei 225 dropped 1.35% to 7645.91 while Hong Kong's Hang Seng plunged 3.8% to 12945.40. Australia's ASX 200 fell 1.5% to 3464.30.