STOCKS PLUNGE 508 POINTS, A DROP OF 22.6%; 604 MILLION VOLUME NEARLY DOUBLES RECORD; MORE ABOUT THE MARKETS

By LAWRENCE J. De MARIA

Bonn and the United States agreed that the dollar should be stabilized near current levels. Disagreement on currency levels and interest rates had contributed to unrest in the markets. Page D1.

Small investors searched for news much of the day. Many held on to their stocks, as they tried to determine what really was happening in the stock market. Page D1.

Washington officials hesitated to offer investors immediate advice. The shouts of panic on Wall Street echoed only faintly in the corridors of the Reagan Administration. The White House maintained that the underlying economy remained sound. News analysis, page D32.

Investors bought U.S. securities in a search for a safe place to put their money. Some interest rates hovered just below 10 percent. Page D1.

Tokyo's stock market plummeted to record losses today and the Hong Kong market suspended trading for the week as Asian investors reacted in fright to the collapse on Wall Street. Page D1.

Business leaders were shaken by the collapse, which wiped out huge amounts of the market value of their companies. And they seemed to have been caught by surprise. But many leaders were confident the panic would pass. Page D32.

Trading tested computers' ability to handle a volume of trading that had not been expected until the early 1990's. Page D34.

Wall Street firms are uncertain about the effect the historic drop could have on them, but some analysts fear that smaller and poorly capitalized firms may find rough going in the days ahead. Page D33.

Mutual funds sold stock shares in huge numbers, feeding the historic drop. Several mutual fund management companies said the number of phone calls from investors was about double the normal volume. Page D33.

New York City could be affected significantly because of its large number of securities industry employees. Some experts maintain that the city's economy has grown too reliant on Wall Street. Page D32.

Overseas investors sold actively on Wall Street after years of having poured money into the bull market. Accounts of the volume of foreign selling varied widely. Page D14.

The dollar closed lower against leading currencies except the Canadian dollar. Analysts said trading was quiet as traders were preoccupied by the jarring news from the stock market. Gold was $486.50 an ounce, up $15.50 from Friday to reach its highest level in over four years. Page D26.

Democratic leaders called for talks with President Reagan on a deficit-reduction package that would include tax increases. Page D32.

In politics, two questions loomed: How badly were the Republicans' 1988 chances hurt? How were the Democrats' prospects helped? Political Memo. Page A30.