US stocks sank Thursday in the second day of losses after President Barack Obama's re-election victory, trimming another one percent after Wednesday's huge rout.

At the closing bell the Dow Jones Industrial Average lost 120.95 points (0.94 percent) to 12,811.78.

The broad-based S&P 500 fell 16.99 (1.22 percent) to 1,377.54, while the tech-rich Nasdaq Composite lost 41.71 (1.42 percent) at 2,895.58.

The fall added to the Dow's 313-point drop on Wednesday -- the biggest one-day loss in a year -- one day after Obama defeated Republican challenger Mitt Romney at the polls.

On the same day the S&P lost nearly 34 points and the Nasdaq nearly 75 points.

Traders said Wall Street, which had largely favored Romney, was reacting more to the specter of a new grueling battle between Democrats and Republicans over the deficit and the looming "fiscal cliff" spending cuts and tax hikes.

"Markets did an about-face yesterday, as heavy selling crushed major indices by more than two percent," said Tony Venosa of Schaeffer's Investment Research.

"The looming 'fiscal cliff' and eurozone economic issues have been brought to the forefront."