[h=1]Dow plunges 500 points[/h] By Annalyn CenskyAugust 4, 2011: 3:54 PM ET The Dow has now lost all of the ground it gained in 2011. Click the chart for more stock market data. NEW YORK (CNNMoney) -- Whoops! There goes any progress stocks made in 2011. Stocks plunged Thursday, with the Dow tumbling 500 points just before the close, as fear about the global economy spooked investors. "The conventional wisdom on Wall Street was that the economy was growing -- that the worst was behind us," said Peter Schiff, president of Euro Pacific Capital. "Now what people are realizing is the stimulus didn't work, and we may be headed back to recession."U.S. markets were already sharply lower on widespread worries, including the weak job market. But the selling gained momentum as Japanese and European policymakers stepped in with dramatic measures to shore up their financial markets. There's "total fear" in the market, said Bob Doll, chief equity strategistat the world's largest money manager, BlackRock. All three major indexes tumbled more than 4% Thursday and erased all their gains for the year. The indexes have also pushed into 'correction' territory - defined as a 10% drop from their highs earlier this year. Over the past 10 days alone, the Dow, S&P 500 and Nasdaq have dropped about 8%. "In the last two weeks, we've been through the ringer," said Rich Ilczyszyn, market strategist with futures broker Lind-Waldock. "When we start looking at the recovery, there's nothing to hang our hats on anymore." The market's fear gauge -- the VIX (VIX) -- surged 26% to a reading of 29.5. That's still just shy of 30 -- the level that signals a high degree of fear. With the VIX up 67% from the start of the year, it's clear that fear has been escalating. [h=2]Recession warnings on the rise[/h]A few minutes ahead of the closing bell, the Dow Jones industrial average (INDU) was down 506 points, or 4%, with Alcoa (AA, Fortune 500), Caterpillar (CAT, Fortune 500) and Bank of America (BAC, Fortune 500) among the biggest drags on the blue chip index. The S&P 500 (SPX) was down a staggering 55 points, or 4.4%. The Nasdaq (COMP) lost 123 points, or 4.6%. Some of the better performing tech stocks, Apple (AAPL, Fortune 500), Google (GOOG, Fortune 500) and Netflix (NFLX) were all down between 2% and 3%. Fears about a global slowdown are at the forefront of investors' minds amid recent weak economic data. Early Thursday, the latest reading on jobless claims showed a large number of Americans remain unemployed. [h=2]10 job killing companies[/h]Adding further to investors' jitters, Wall Street is waiting for Friday's jobs report, which BlackRock's Doll said was adding to the selling pressure. The report is now a bit of wild card after it has come in far below forecasts for the last two months.