All of yesterday's gains were erased as investors lost confidence in the global economy. A sharp sell-off sent the markets skidding to close sharply lower with the Dow crashing 519 points to 10,719. Nasdaq collapsed 101 points to 2381.

On the upside

Toreador Resources (Nasdaq: TRGL) will merge with privately held ZaZa Energy.

On the downside

Epocrates (Nasdaq: EPOC) reversed year ago losses to post a profit for the second quarter but the company forecast full year results below expectations.

FX Energy (Nasdaq: FXEN) swung to a second quarter profit as revenue climbed but the stock price dropped.

Second quarter earnings for China Information Technology (Nasdaq: CNIT) tumbled as revenue dropped.

Himax Technologies (Nasdaq: HIMX) disappointed with lower second quarter earnings as revenue fell.

KAR Auction Services (NYSE: KAR) swung to a loss for the second quarter.

In the broad market, declining issues outpaced advancers by a margin of more than 7 to 3 on the NYSE and by 4 to 1 on Nasdaq. The Russell 2000 which tracks small cap stocks sank 35 points to 660.