The Dow Jones industrial average lost 58.11 points to close at 6,925.07. Yesterday, the blue-chip barometer tumbled by as much as 123 points in the aftermath of a speech by Fed chairman Alan Greenspan before recovering to a 55-point loss.
Decliners outnumbered advancers by a 7-to-4 margin on the New York Stock Exchange, with 917 up, 1,620 down and 804 unchanged. NYSE volume was 464.68 million shares vs. 566.31 million yesterday.
The Standard & Poor's 500-stock list fell 10.60 to 795.08, and the NYSE's composite index fell 4.25 to 417.89. The Nasdaq composite index fell 27.82 to 1,312.73, and the American Stock Exchange composite index fell 2.14 to 595.17.
Stocks tumbled yesterday with bonds after another warning by Greenspan that the stock market's surprising gains pose an inflationary risk. It was the second time in three months that Greenspan sent the market into a panic by wondering aloud if investor exuberance might need to be tempered.
Although recent reports have shown that inflation remains under control, a series of surprisingly robust economic readings has fanned worries that inflationary pressures such as rising production costs might flare up, forcing retail prices higher.
Today, the Commerce Department reported that orders to U.S. factories for big-ticket durable goods shot up 3.6 percent in January to $174.8 billion. Many analysts had expected a much smaller 1.4 percent increase.