NEW YORK (AP) — Financial companies dragged stocks lower yesterday as already anxious investors grew even more uncertain about the US government's financial overhaul plan and debt problems in Europe.

The Dow Jones industrial average slid 80 points in the final 15 minutes of trading to end with a loss of almost 127. It was the lowest close for the Dow since February 10. The Dow and the Standard & Poor's 500 index fell more than one percent.

Investors are worried about limits that could be placed on US banks in a final version of the financial overhaul bill. A bill that passed the Senate last week is now being reconciled with the House version. The late drop illustrates how jittery traders are in particular about what will happen in Europe.

"People are afraid to go home and say 'All of the sudden what's going to happen overnight in Europe? Is something new going to pop up?'" said Joe Saluzzi, co-head of equity trading at Themis Trading LLC.

The rescue of a Spanish bank raised investors' uneasiness about Europe's economy. Investors can't shake their concerns that there could be more bank bailouts in Europe if a wave of bad debt cascades through financial markets. It's not clear that will happen, but traders remember well the problems in the US that began with bad sub-prime loans. Those problems started small but eventually helped take down Lehman Brothers in September 2008.

The Bank of Spain stepped in to rescue Cajasur after it failed to complete a merger. It was only the second time Spain's central bank saved a regional lender. The country is one of those already dealing with ballooning deficits.

Meanwhile, traders still don't have a clear idea about which financial overhaul provisions will remain in the combined House and Senate bill. That is making some traders cautious about betting on financial stocks.

It remains uncertain, for example, whether a final bill will include a Senate provision that would require big banks to sell their derivatives operations. Derivatives are often profitable but risky investments. Derivatives that were tied to mortgages were blamed for worsening the housing crisis.

The Dow fell 126.82, or 1.2 percent, to 10,066.57. The S&P 500 index fell 14.04, or 1.3 percent, to 1,073.65, and the Nasdaq composite index fell 15.49, or 0.7 percent, to 2,213.55.

About three stocks fell for every two that rose on the New York Stock Exchange, where consolidated volume came to came to 8.1 billion shares compared with 2.3 billion Friday.

Bond prices rose. Investors have been flocking to the relative safety of government bonds and have at times dumped riskier assets like stocks and commodities. The yield on the 10-year Treasury note, which moves opposite its price, fell to 3.20 percent from 3.24 percent late Friday.

Gold rose $17.90 to $1,194 an ounce.

Crude oil rose 17 cents to $70.21 per barrel on the New York Mercantile Exchange.

The euro fell against the dollar, dropping to $1.2361. The 16-nation currency has become a symbol of investors' concern about the continent's economy. Traders have been dumping the euro on fears that massive debts will cause a default by a weaker country in the European Union. The euro hit a four-year low against the dollar last week.

Analysts question whether countries like Greece, Spain and Portugal will be able to contain mounting debt through steep spending cuts. Investors are also worried that those budget cuts will upend an economic recovery in Europe and slow a worldwide rebound.

"Right now the US financial markets are trading very much out of fear and not any fundamentals," said Guy LeBas, chief fixed income strategist of Janney Montgomery Scott in Philadelphia.

Despite a rally on Friday that lifted the Dow 125 points, major indexes still ended lower last week. Stocks are now trading at about where they were in early February and are down for the year.

The major indexes are down about 10 percent from their highs of the year, set in late April. That size drop is known as a "correction." It's the first retreat of that scale since stocks began a largely uninterrupted advance off of 12-year lows reached in March of 2009.

The Dow is down 1,138.46, or 10.16 percent, since April 26.