Midday Leaders & Laggards: S&P 500

The S&P 500 fell 26.39 points, or 2 percent, to 1,295.58, its lowest level since March.

Bond insurer MBI Inc. took the biggest loss, plunging 60 cents, or 12.2 percent, to $4.31. Shares hit an 21-year low of $4.21 earlier in the session.

General Motors tumbled $1.35, or 10.5 percent, to $11.46. A Goldman Sachs analyst cut GM to "Sell" from "Neutral," saying things could still worsen for the U.S. auto industry. The last time GM stock traded below $12 was Jan. 2, 1975, according to the University of Chicago's Center for Research in Security Prices.

Goodyear Tire & Rubber Co. fell $2.22, or 10.9 percent, to $18.30. The company said Thursday it plans to increase its cost-cut target to more than $2 billion by 2009 and further invest in Latin America, Eastern Europe and Asia.

Among the gainers, Bed Bath & Beyond Inc. jumped $1.85, or 6.5 percent, to $30.42 after the home furnishings retailer posted better-than-expected first-quarter results despite a difficult environment for retailers.

Sprint Nextel Corp. gained 34 cents, or 4 percent, to $8.89. The company said its recently launched touch-screen Instinct smart phone is selling at a record pace.

AutoZone Inc. gained $4.61, or 4.1 percent, to $116.43. The auto parts retailer said Thursday it approved a $500 million buyback program.