NEW YORK (AP) -- A week ago, markets were soaring on hopes that a fix for Europe's debt crisis was near. On Monday, stocks had their worst drop in two weeks after German leaders cast doubt on how fast that process would be.

Expectations that a resolution to the crisis could be reached at a European summit in Brussels Oct. 23 helped lift the S&P 500 index to its biggest gain in two years last week. Germany's finance chief Wolfgang Schaeuble said Monday that those expectations were too optimistic.

It was the worst day for U.S. stock indexes since Oct. 3, when each hit a low for the year. The Dow Jones industrial average dropped 247.49 points, or 2.1 percent, to close at 11,397. Alcoa Inc. led the Dow lower with a 6.6 percent decline.

“It's completely a reaction to Germany,” said Jason Pride, the director of investment strategy at Glenmede, a wealth management firm in Philadelphia. “The reality is everybody is hanging on to what Europe's doing.”

The Standard & Poor's 500 index lost 23.72, or 1.9 percent, to 1,200.86. All 10 industry groups in the S&P 500 were lower. Banks fell the most, 3.3 percent.

A batch of weak corporate earnings reports also pulled stocks lower. Gannett Co. Inc. plunged 8 percent, the most of any stock in the Standard & Poor's 500 index, after the newspaper publisher reported a drop in advertising. Wells Fargo sank 8.4 percent after posting results that fell short of analysts' expectations.

The Nasdaq composite index fell 52.93, or 2 percent, to 2,614.92.

Stock markets around the world rallied last week after the leaders of France and Germany pledged to come up with a far-reaching solution to the region's debt crisis by the end of October. That pledge appeared to be pushed back by German officials Monday. Schaeuble said he expects European leaders to adopt a general framework to tackle the crisis on Sunday. Separately, a spokesman for German Chancellor Angela Merkel said discussions on how to solve Europe's debt problems will likely last into the new year.

Concerns about a messy default by the Greek government have been the main cause behind many of the stock market's big swings lately. The fear is that a default would cause deep losses for European banks that hold Greek bonds. That could lead to a freeze in lending between banks and escalate into another financial crisis similar to the one that occurred in 2008 after the collapse of Lehman Brothers.

Pride said there are other issues to worry about, such as a global economic slowdown and squabbles over U.S. government debt. But Pride believes the European debt debacle is the only one that has the power to undermine the global financial system.

News on the U.S. economy was mixed. A measure of U.S. industrial production rose for a third month, but a gauge of New York area manufacturing fell more than Wall Street expected.

The yield on the 10-year Treasury note fell to 2.16 percent from 2.25 percent late Friday. Yields on bonds fall when demand for them increases and investors become more willing to accept lower returns in exchange for holding assets they consider safe.

In corporate news, Kinder Morgan said late Sunday that it would buy El Paso Corp. for $20.7 billion. The deal would create America's largest natural gas pipeline operator. El Paso jumped 24.8 percent. Kinder Morgan Inc., gained 4.8 percent.

Citigroup Inc. fell 1.6 percent, less than the overall market, after the bank said a decline in loan losses helped it beat Wall Street's profit forecasts. The parent of American Airlines, AMR Corp., sank 6.1 percent on news the company and its pilots failed to reach agreement on a new contract over the weekend.