Wall Street extended losses Thursday, with the Dow Jones industrial average suffering its 11th loss in last 12 trading sessions, amid intensified fears about European banking systems.

When the market closed, the Dow Jones industrial average fell 156.06 points, or 1.24 percent, at 12,442.49. The Standard & Poor' s 500 was down 19.44 points, or 1.51 percent, to 1,304.86. The Nasdaq Composite Index lost 60.35 points, or 2.10 percent, to 2, 813.69.

Stocks followed European markets lower in morning session as investors were rattled after a report showed customers at Bankia, the fourth largest bank nationalized by Spanish government last week, had withdrawn more than 1 billion euros from their accounts since last Wednesday.

Although the Spanish government said there had been no exit of deposits from the lender, the shares of Bankia, plunged 20 percent.

Spain was also forced to pay sharply higher interest rates in a debt auction Thursday, another proof of mounting fears among investors.

Thursday's gloomy economic data could hardly have any positive effect on the market. According to the U.S. Labor Department, the number of people applying for jobless benefits was unchanged at 370,000 last week, in line with previous expectations.

A separate report from the Conference Board also showed the Leading Economic Index, which gauges the economic outlook for the next three to six months, dropped 0.1 percent to 95.5 in April, after six months of increases.

Adding to the selling, the Federal Reserve Bank of Philadelphia said manufacturing slowed in the mid-Atlantic region for the first time in eight months, with new orders decreasing and firms cutting jobs.

Two pieces of bad new about Europe came in the afternoon. Fitch ratings agency downgraded Greece's rating by one notch from B- to CCC, the lowest possible grade for a country that is not in default, warning of a probable Greek exit from the euro zone.

Shortly after that, Moody's Investors Service downgraded the long-term debt and deposit ratings for 16 Spanish banks and Santander UK PLC, which is a Britain-domiciled subsidiary of Banco Santander, as the banks' credit situation worsened and the government's ability to support the banks reduced.

Also worthy of mentioning on Wall Street was that Facebook set the price for its highly-anticipated initial public offering (IPO) at 38 dollars per share after the market closed, which was the high end of its expected range of 34 dollars to 38 dollars per share.

At the price of 38 dollars a share, the social networking giant will sell 421 million shares, raising about 16 billion dollars, which is the largest ever among all internet companies. That will also give the 8-year-old startup a valuation of 104 billion dollars, the biggest of all time.