Dow drops another 123.58

Associated Press

NEW YORK - Stocks ended sharply lower today, wiping out early gains, after continued concerns about interest rates and Internet stocks outweighed a sign of continued optimism about the U.S. economy.

The Dow Jones industrial average was down 123.58, or by 1.2 percent, at 10,531.09. The index of blue-chip stocks had surrendered a gain of nearly 100 points earlier in the session.

The Standard & Poor's 500 fell 22.25, or 1.7 percent, to 1,284.40, and the technology-heavy Nasdaq composite index fell 72.77, 2.97 percent, to 2,380.89.

Decliners beat advancers by a 7-to-4 margin on the New York Stock Exchange, with 1,911 down, 1,082 up and 551 unchanged. NYSE volume totaled 822.35 million shares vs. 743.32 million yesterday.

The NYSE composite index fell 8.71 to 617.34; the American Stock Exchange composite index sank 6.57 to 778.84; and the Russell 2000 index of smaller companies fell 5.94 to 434.45.

The 30-year Treasury bond was unchanged, yielding 5.75 percent.

Stocks rose this morning after the Conference Board reported that consumer confidence, a key indicator of future economic activity, rose in May for a record-setting seventh consecutive month.

The report temporarily boosted a market that has been waiting anxiously for a new sign of the economy's strength, analysts said.

But by midafternoon, much of the market's enthusiasm had evaporated, and the Nasdaq market's steep drop was matched by the Dow in the final hour of trading.