The CNN Money Fear and Greed index showed a further decline in the overall market sentiment, with the index moving to the "Extreme Fear" zone on Monday.

U.S. stocks settled lower on Monday, with the Dow Jones index tumbling over 1,000 points during the session to record its worst day in around two years.

On the economic data front, the ISM services PMI climbed to 51.4 in July from 48.8 in April and also topped market expectations of 51. The S&P Global composite PMI was revised lower to 54.3 in July versus the preliminary reading of 55.

Nvidia Corp. (NASDAQ:NVDA) shares dipped 6.4% on Monday, bringing its plunge from its 52-week high level to around 29%. Shares of Apple Inc. (NASDAQ:AAPL) declined 4.8% during Monday's session after Warren Buffett's Berkshire Hathaway slashed its stake in the company in half.

All sectors on the S&P 500 index closed on a negative note, with information technology, communication services, and consumer discretionary stocks recording the biggest losses on Monday.

The Dow Jones closed lower by around 1,034 points to 38,703.27 on Monday. The S&P 500 fell 3% to close at 5,186.33, while the Nasdaq Composite dipped 3.43% to close at 16,200.08 during Monday's session.

Investors are awaiting earnings results from Uber Technologies, Inc. (NYSE:UBER), Wynn Resorts, Limited (NASDAQ:WYNN), and Caterpillar Inc. (NYSE:CAT) today.

What is CNN Business Fear & Greed Index?

At a current reading of 19.1, the index moved to the "Extreme Fear" zone on Monday, versus a prior reading of 26.9.

The Fear & Greed Index is a measure of the current market sentiment. It is based on the premise that higher fear exerts pressure on stock prices, while higher greed has the opposite effect. The index is calculated based on seven equal-weighted indicators. The index ranges from 0 to 100, where 0 represents maximum fear and 100 signals maximum greediness.