U.S. and European stocks plunged amid news that the euro zone’s debt crisis is worsening and that a special U.S. Congress panel failed to agree on how to cut the federal budget deficit.

At the New York Stock Exchange, the Dow Jones Industrial Average fell two-point-one-one percent on Monday.

Britain’s FTSE 100 index slid around two-and-a-half percent from last Friday while Germany’s DAX index fell around three percent and France’s CAC 40 index tumbled around three-point-two percent.

Market observers blamed the drop in stocks to projections that efforts to resolve the euro zone’s debt and financial crises will not be easy and the failure of a special 12-member panel of the U.S. Congress to reach a deal on slashing the federal budget deficit down by one-point-two trillion dollars over ten years.