The Dow lost nearly 79.01 points to close at 6442,69, having surrendered a 33-point morning gain that briefly put the blue-chip barometer into record territory. It was the biggest one-day point loss since the Dow's 161-point dive on July 15, which came amid worries about inflation and corporate profits.
Advancers led decliners by a slim margin on the New York Stock Exchange, with 1,301 up, 1,217 down and 816 unchanged. NYSE volume was 515.65 million shares vs. 412.48 million yesterday.
Broader measures also pulled back sharply late in the session.
The Standard & Poor's 500-stock index fell 8.26 to 748.30, and the NYSE's index lost 3.29 to 394.85. The American Stock Exchange's index lost 0.75 to 592.18.
But the Nasdaq composite topped 1,300 for the first time, rising 0.55 to 1,300.37. It was the seventh straight record high for the technology-heavy index.
Stocks opened the day higher as Treasury bonds rallied.
As bond prices rose in the morning, the yield on the 30-year Treasury bond - a key determinant of corporate and consumer borrowing costs - fell as low as 6.31 percent from late yesterday's 6.36 percent.
The yield hasn't finished a day below 6.33 percent since mid-February, just before this year's inflation jitters started to build in the financial markets. But as bonds retreated this afternoon, the yield rose to 6.35 percent.