A breakdown in budget negotiations in the Netherlands renewed concerns about the European economy sending the markets tumbling to a sharply lower open with the Dow slumping 161 points to 12,867. Nasdaq plummeted 45 points to 2954.

On the upside

Andrea Biosciences (Nasdaq: RDEA) will be acquired by AstraZeneca (NYSE: AZN) in a deal valued at approximately $1.26 billion.

Reuters reported that Amylin Pharmaceuticals (Nasdaq: AMLN) retained the services of Credit Suisse and Goldman Sachs to explore the possible sale of the company.

Brinker International (NYSE: EAT) reported higher third quarter earnings that beat analyst expectations as revenue rose.

On the downside

A New York Times article alleged that Wal-Mart (NYSE: WMT) halted an internal investigation into bribery in Mexico.

Check Point Software Technologies (Nasdaq: CHKP) reported higher first quarter earnings as revenue rose but the stock price fell.

JMP Securities downgraded Achillion Pharmaceuticals (Nasdaq: ACHN) saying that the company's Phase 2 clinical trial results for its hepatitis C treatment ACH-1625 were confusing.

In the broad market, declining issues outpaced advancers by a margin of more than 7 to 1 on both the NYSE and on Nasdaq. The Russell 2000 which tracks small cap stocks plunged 17 points to 786.