Well, I understand your concern about “throwing good money after bad”! But in a way if you stop, you’re passing on an opportunity to buy mutual funds at bargain prices. And you’re missing out a lot if your employer contributes a matching amount.
How about you keep contributing, but choose a more conservative fund inside your 40l(k) — either a VERY short-term bond fund, or an equity-income fund. You don’t have to start taking money out for another 8 years, and the market should rebound by then!