U.S. stocks were down more than 3 percent on Thursday afternoon after briefly nosediving, with the Nasdaq at one point down more than 9 percent and the S&P 500 and Dow briefly falling into negative territory for the year, as worries about contagion from Greece's debt problems mounted.

Investors were disappointed the European Central Bank did not take fresh measures to help stem the Greek debt crisis. The ECB did not discuss the outright purchase of European sovereign debt as some had hoped for, but gave verbal support instead to Greece's savings plan. The ECB left interest rates at a record low.

Right now you just have a panic sell. It could be a long-term negative for stock market because it could mean the long-term high is in place. It's very likely we've seen the highs for this cycle, said Keith Springer, president of Capital Financial Advisory Services in Sacramento, California.

The Dow Jones industrial average was down 340.47 points, or 3.13 percent, at 10,527.65. The Standard & Poor's 500 Index was down 35.89 points, or 3.08 percent, at 1,130.01. The Nasdaq Composite Index was down 65.34 points, or 2.72 percent, at 2,336.95.

(Reporting by Caroline Valetkevitch, additional reporting by Al Yoon; Editing by Leslie Adler)

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