U.S. stocks fell sharply on Thursday amid concern over cooling housing market and subprime loan crisis, with the Dow falling more than 300 points.

In the closing trading, the Dow Jones Industrial Average, which after falling as much as 449.77 in earlier trading, was down 311.50 points, or 2.26 percent, the biggest loss since Feb. 27, to 13,473.57. The Standard & Poor's 500 index fell 34.98 points, or 2.30 percent, to 1,483.11. The Nasdaq composite index fell 48.83 points, or 1.84 percent, to 2,599.34.

New home sales in the United States fell by 6.6 percent in June, the largest amount in five months and more than triple what had been expected, the Commerce Department reported Thursday.

The median price of a new home, the point where half of the new homes are sold for more and half for less, was 237,900 dollars, down 2.2 percent from a year ago. It was the biggest year-over-year price drop since this April.

Due to the cooling housing market, the No. 1 subprime lender Countrywide Financial reported a 33 percent decline in quarterly profit.