The 30-stock index sank 1,762.77 points, or 6.8%, to wind up a disastrous session at 24,102.01.
The broader S&P 500 dived 225.81 points, or 7.6%, to 2,746.56. The massive selloff triggered a key market circuit breaker minutes into the opening bell. Trading was halted for 15 minutes until reopening.
The NASDAQ plunged 624.94 points, or 7.3%, to 7,950.68.
Bank stocks were smashed as lower yields put pressure on their margins, while an oil crash could cause energy companies to default on their obligations. JPMorgan, Citigroup and Bank of America all plunged more than 10%.
President Donald Trump blamed the media and the oil price war for the stock rout on Monday, arguing in a series of tweets that lower gasoline prices are “good for the consumer.”
Traders expect the U.S. Federal Reserve to slash rates by three-quarters of a percentage point at its upcoming March meeting. Chances for a full percentage point cut this month were at 29.2%
Saudi Arabia on Saturday slashed official crude selling prices for April, in a sudden U-turn from previous attempts to support the oil market as the coronavirus hammers global demand.
The move came after the Organization of the Petroleum Exporting Countries talks collapsed Friday, prompting some strategists to see oil prices crater to $20 this year.
Investors have already been on edge about the coronavirus outbreak that caused major stock averages to tumble into correction territory. As of Monday, global cases of the infection have climbed to more than 111,000 with at least 3,800 deaths around the world.
The situation is also worsening in the U.S. with New York, California and Oregon all declaring states of emergency.
Prices for the 10-Year U.S. Treasury moved sharply higher, lowering yields to 0.60% from Friday’s 0.78%. Treasury prices and yields move in opposite directions.
Oil prices dropped $10.29 to $30.99 U.S. a barrel. Gold prices regrouped $5.20 to $1,677.60 U.S. an ounce.