Stocks tumbled yesterday on fears that the worsening ills in the mortgage and debt markets could soon take a significant toll on consumers, businesses and the overall economy.

The latest decline capped a volatile two weeks on Wall Street in which the stock market has swung wildly from day to day, reflecting rising uncertainty about the outlook for markets and the risks plaguing the economy. The biggest moves lately have often occurred shortly before trading closed.

Indeed, the market dropped particularly sharply yesterday afternoon after investors were rattled by remarks by executives at Bear Stearns, the investment bank that has been heavily involved in mortgage securities. The firm’s assurances about its own financial position were overshadowed by bleak comments by its chief financial officer about the credit markets.

“I have been at this for 22 years, and this is about as bad as I have seen it in the fixed-income market,” said Samuel L. Molinaro Jr., Bear Stearns’s chief financial officer.

The Standard & Poor’s 500-stock index fell 2.7 percent yesterday, with much of the decline coming after Bear’s conference call started around 2 p.m. The Dow Jones industrial average lost 281.42 points, or 2.1 percent. And the dollar fell noticeably against the euro and the British pound.

While consumers continue to express confidence in the outlook for the economy, the government’s monthly employment report, released yesterday morning, added to worries about the spreading impact of the housing slump. The economy added only 92,000 jobs last month, down from 126,000 in June and the unemployment rate ticked up to 4.6 percent.

Mortgage companies have significantly tightened credit lately to borrowers with weak credit histories and are even cracking down on those with solid records who are taking on riskier loans.

On Thursday, the credit worries were so severe that even Countrywide Financial, the nation’s largest mortgage company, felt compelled to tell investors that it did not face any difficulties raising money.

Lenders say they are increasingly unable to persuade investors to buy packages of home loans made to borrowers with little or no down payment or those who cannot fully document their incomes. As a result, many companies are no longer offering such loans to potential buyers.

“I have never seen it happen so quickly,” said Steve Walsh, a mortgage broker in Scottsdale, Ariz. “Banks always do these little cutbacks here and there. What they are doing now is a liquidity crunch. It’s a credit freeze.”

Richard F. Syron, chief executive of Freddie Mac, the large buyer of mortgages created by Congress in the 1970s, said yesterday that the speed and severity of the tighter credit terms are surprising, but perhaps necessary given the excesses in the market in recent years.

In a telephone interview from Washington, he was wary of the calls by some mortgage industry officials that Freddie Mac and its cousin, Fannie Mae, step in to buy loans and securities that private investors will no longer purchase. Mr. Syron noted that his company was operating under an agreement with its regulator that limited the size of its portfolio.

“There are some loans that are in difficulty” because credit pools are drying up, Mr. Syron said. “There are other loans that probably should never have been made and providing more liquidity will make that situation worse in the long term.”

The interest rates on many popular mortgages have risen by as much as a full percentage point, if they are available at all, said George J. Jenich, founder of FreeRateSearch.com, a consumer Web site. But rates on conventional fixed-rate 30-year mortgages have held steady.

Bear Stearns scheduled its conference call to reassure investors after Standard & Poor’s, one of the agencies that rates the creditworthiness of companies, said it was considering downgrading Bear’s credit rating because of the collapse of two hedge funds it recently put into bankruptcy after they made losing bets on mortgage securities.

Despite all the worries about credit markets, however, the economy continues to plow ahead and even yesterday’s jobs report was not weak enough to suggest that the Federal Reserve would cut its benchmark short-term interest rate when it meets next week.

But the risks to the economy do seem serious enough that investors now expect the Fed to cut its rate to 5 percent, from 5.25 percent by November, based on the price of a trading instrument that is tied to Fed policy. And the yield on the 10-year Treasury note fell to 4.68 percent from 4.77 percent Thursday evening.

Wall Street analysts say they are increasingly concerned that consumer spending will weaken as more people in housing and related sectors lose their jobs. They also worry that many homeowners will cut back as they find it harder to refinance or borrow against the value of their homes.

“You have a broad sell-off because people don’t know how far the subprime cloud is going to hang over U.S. industries,” said Jake Dollarhide, chief executive of Longbow Asset Management, an investment firm based in Tulsa, Okla. “If they don’t get assurance, they are just selling off rather than asking questions.”

The S.& P. has fallen 7.7 percent, to 1,433.06, since July 19, the day it established a record. The last two weeks were the worst such period in more than four and a half years, and the broad market index is now up just 1 percent for the year. The Dow is doing somewhat better; it has fallen 5.9 percent, to 13,181.91, since July 19, but it is still up 5.8 percent for the year.

And through it all, businesses have been reporting strong earnings. Profits are up 9.6 percent in total for the 80 percent of the companies in the S.& P. index that have released results for the second quarter, noted Douglas M. Peta, chief market strategist at J. & W. Seligman & Company, an investment firm based in New York.

Despite that, Mr. Peta said, he was not particularly optimistic about the near-term outlook for stocks and far less so about the market for debt.

“It seems to me things got every bit as silly in the credit markets in the last few years as they did in tech stocks in the late 1990s,” he said. “I still think we may have a ways to go in this.”