Sharply lower manufacturing activity fueled recessionary fears sending the markets skidding to a close with the Dow plummeting 307 points to 12,159. Nasdaq plunged 48 points to 2347.

On the upside

LaserCard (Nasdaq: LCRD) will develop an identification management system with two other companies for the Angola government.

Stoneridge (NYSE: SRI) forecast fourth quarter results above expectations and lifted its full year earnings.

Although fourth quarter sales tumbled 24% for Meritage Homes (NYSE: MTH), the homebuilder expects a profit for 2007.

On the downside

Virgin Mobile (NYSE: VM) will replace outgoing chief marketing officer Howard Handler with Bob Stohrer.

Shares of mortgage insurer MGIC (NYSE: MTG) tumbled as new home construction plunged more than 24%, the greatest decline since 1980.

Under Armour (NYSE: UA) forecast 2007 results above expectations but the stock price dropped.

In the broad market, declining issues outpaced advancers by a margin of nearly 6 to 1 on the NYSE and by nearly 7 to 2 on Nasdaq. The Russell 2000 which tracks small cap stocks plunged 19 points to 681.