Stocks drop
on profit taking

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By Amy Baldwin
Associated Press

NEW YORK >> Wall Street retreated today as wary investors followed a now-familiar pattern of locking in profits after a huge rally. The Dow Jones industrials had their eighth straight triple-digit move, falling more than 180 points and wiping out more than half their gain of the previous session.

An earnings warning from Dow Chemical gave investors another reason to sell. But the decline was unsurprising given investors' worries about earnings and the fact that the market has been unable to hang on to gains.

Investors have also been concerned about the possibility of war with Iraq.

"There is an awful lot of indecision, a lack of clarity as to where are we headed," said Tim Leach, chief investment officer for Wells Fargo's Private Client Services, about both the economy and Iraq.

Indeed, there was much indecision on Wall Street today. The Dow was down more than 100 points in early trading, recovered to an advance of 30 points in the afternoon, and then turned sharply lower during the afternoon.

Declining issues outnumbered advancers about 2 to 1 on the New York Stock Exchange where volume was heavy. The blue chips closed down 183.18, or 2.3 percent, at 7,755.61. The Dow has been in a pattern of enjoying one huge up day for every two or three big drops. Prior to yesterday's rally, the Dow suffered a two-day 406-point loss.

The broader market was also lower. The Nasdaq composite index fell 26.42, or 2.2 percent, to 1,187.30. The Standard & Poor's 500 index fell 20.00, or 2.4 percent, to 827.91. The Russell 2000 index fell 7.87, or 2.1 percent, to 360.22.

The price of the Treasury's 10-year note was up 11/32 point today, while its yield fell to 3.68 percent from 3.72 percent late yesterday. Two-year Treasury notes were up 3/32 point and yielded 1.72 percent, down from 1.78 percent yesterday.

Earnings woes have fueled much of the market's recent selloffs as analysts' growth estimates for companies have fallen to about 8 percent from about 20 percent.

"We are still in (earnings) preannouncement season and warnings are outpacing upwards guidance by about 2 to 1," said Jeff Kleintop, chief investment strategist for PNC Financial Services Group in Philadelphia.

Investors sold off stocks with disappointing earnings news today. Dow Chemical fell $2.55 to $27.25, after the nation's second-largest chemical company cut its third-quarter earnings estimate. Competitor DuPont declined $2.32 to $37.31.

Swiss banking giant Credit Suisse fell $1.76 to $18.29 after warning it will post a third-quarter loss due to shortfalls in investment bank and insurance.

Advent Software fell 79 cents to $10.81 after warning that revenue for the third and fourth quarters will miss analysts' expectations.

But Dell Computer rose 67 cents to $25.35, having late yesterday raised its third-quarter sales forecast and reaffirming its earnings outlook.

Overseas, Japan's Nikkei stock average finished down 1.2 percent. In Europe, France's CAC-40 climbed 4 percent, Britain's FTSE 100 rose 2.8 percent, and Germany's DAX index gained 2.2 percent.