The stock market slumped again Tuesday, leaving the Nasdaq composite index down more than 9% from its recent high, as oil prices ticked up and consumer confidence declined.
Heavy-industry shares, which have been among the market's best performers over the last year, led the latest sell-off as some investors rushed to take profits. Machinery giant Caterpillar tumbled nearly 5%.
Nervous investors also continued to pull away from emerging markets overseas, U.S. small stocks and from the corporate junk bond market.
On Wall Street, the Dow Jones industrial average fell 79.95 points, or 0.8%, to 10,405.70, a two-month low.
The Standard & Poor's 500 index dropped 8.92 points, or 0.8%, to 1,165.36, holding just modestly above its 2005 closing low of 1,163.75 set Jan. 24.
The technology-dominated Nasdaq composite hit a five-month low, losing 18.64 points, or 0.9%, to 1,973.88. Microsoft slipped 28 cents to a 52-week low of $23.92.
The Nasdaq index is down 9.4% from its multi-year closing high reached Dec. 30. By contrast, the Dow is off 4.9% from its high reached March 4.
Stocks have been in a broad downtrend since the start of this month, hurt by rising interest rates and stubbornly high oil prices. Near-term crude oil futures edged up 18 cents to $54.23 a barrel in New York on Tuesday.
The Conference Board's report Tuesday that its consumer confidence index declined this month to a four-month low reminded some investors of the risks to the economy from higher interest rates and energy costs, analysts said.
"It's going to take a number of positive things, from both an economic and individual company basis, for the market to get some momentum and enthusiasm going," said Brian Bruce, director of global investments at PanAgora Asset Management Inc. in Boston.
Some analysts said first-quarter earnings reports could provide a lift in April if results were better than expected.
In the meantime, end-of-quarter portfolio shuffling could continue to put downward pressure on stocks, some warn. On Tuesday, losers outnumbered winners by more than 2 to 1 on the New York Stock Exchange and on Nasdaq, a sign of broad-based selling.
Among the day's highlights:
* Caterpillar slid $4.42 to $89.80 after an analyst at brokerage Morgan Stanley said investors should consider taking profits in many of the heavy-industry shares that have performed well over the last 18 months.
