Investors dumped stocks Wednesday in the sharpest sell-off of the year. With the election only hours behind them, they focused on big problems ahead in Washington and across the Atlantic Ocean.
Heavy selling recalled the days after Obama's first victory, as the financial crisis raged and stocks spiraled downward.
Four years later, American voters returned a divided government to power. Investors fretted about a package of tax increases and government spending cuts that could stall the economic recovery unless Congress acts to stop it by Jan. 1.
In Europe, leaders warned that unemployment could remain high for years, and cut their forecasts for economic growth for this year and 2013. The head of the European Central Bank said not even powerhouse Germany is immune.
The Dow Jones industrial average plummeted as much as 369 points, or 2.8 percent, in the first two hours of trading. It recovered steadily in the afternoon, but slid into the close and ended down 312.95, its biggest point drop since this time last year.
"It does look ugly," said Robert Pavlik, chief market strategist at Banyan Partners Llc. He said it was hard to untangle the impact of Europe-related selling from nerves about the nation's fiscal uncertainty.
It was the worst day for stocks this year, but not the worst after an election. That distinction belongs to 2008, when Barack Obama was elected at the depths of the financial crisis. The Dow fell 486 points the next day.
Stocks seen as benefiting from Obama's decisive re-election rose. They included hospitals, suddenly free of the threat that Romney would roll back Obama's health care law.
On the day after the 28 other presidential elections since 1900, the stock market has gone up 13 times and down 15 times, according to research by Bespoke Investment Group, a market research company.
Renewed focus on European economic problems pushed the price of oil down $4.27 per barrel, its biggest decline of the year, to finish at $84.44, the lowest since July 10.
The Dow closed at 12,932.73 -- its first close below 13,000 since Aug. 2.
The Standard & Poor's 500 index fell 2.37 percent, to close at 1,394.53. The Nasdaq composite index lost 2.48 percent to finish at 2.937.29.