Stocks Slammed by Eurozone Woes

"We think the key problem in the eurozone is with Europe all together," Burke continued. "You have the euro itself, the currency is printed by the ECB. The ECB is not really a central bank so it's really a little bit fragmented how it's run; so if you looked at what happened in Japan. You know Japan did not respond to their own recession the right way. They starved their economy of money when they needed to print money. And their economy never really recovered."

"So you have the same situation going on there in the eurozone," he said. "You have a problem where governments like Spain are just clearly running out of money and they can't pay their interest, so that can extend to Italy, that can eventually extend to France, unless they fully figure out that they've got to do something different than what they did in Japan."

The FTSE in London finished behind by 2.09% and the DAX in Germany tumbled 3.18% on Monday. The Hong Kong Hang Seng index settled down nearly 3% and the Nikkei in Japan fell 1.86%.

Meanwhile, safe-haven buying had pushed the yield on the benchmark 10-year Treasury to fresh lows Monday but the intensity of the declines lessened as the day wore on. At last check, the 10-year was up 7/32, diluting the yield to 1.437%, while the greenback was advancing 0.17%, according to the dollar index.

September crude oil futures shed $1.14 to settle at $91.83 a barrel. August gold futures fell by $5.40 to settle at $1,577.40 an ounce.

In corporate news, NRG Energy (NRG) said Sunday it reached a deal to buy GenOn Energy (GEN) for $1.7 billion in stock. The merger creates the largest competitive power generation company in the United States.

Also, Chinese oil and gas exploration giant Cnooc (CEO) has agreed to buy Canadian energy company Nexen(NXY) for $15.1 billion in cash. This is the largest overseas buyout by a Chinese company.

Through Friday, S&P Capital IQ estimated that 69% of the 118 S&P 500 companies that have reported earnings for the 2012 second quarter calendar year have beaten Wall Street's expectations, and 43% of them have shown double-digit profit growth.

Collectively, the S&P 500 has reported a 5.9% EPS surprise, the firm said.