NEW YORK -- Stocks erased early gains and closed lower today, extended its losing streak to three sessions as investors worried that the market was getting too optimistic about the outlook for corporate profits. Dow off 50.81
The Dow Jones industrial average fell 50.81 points to close at 8,796.08. The Dow reversed an early 34-point gain and extended yesterday's 25-point loss, keeping the 9,000 mark elusive.
Decliners beat advancers by an 6-to-5 margin on the New York Stock Exchange, where volume came to 579.61 million shares, down from yesterday's pace.
Broader market indexes also were lower near the close.
The technology-laden Nasdaq composite, which its set its third consecutive record yesterday, was down 4.89 point at 1,823.65. The Standard & Poor's 500 list was down 5.36 at 1,095.44. The NYSE composite index also reversed an early advance and was down 2.41 at 569.80. The American Stock Exchange composite index was down 1.06 at 738.33 and the Russell 2000 index was off 0.66 at 477.15.
The price of the Treasury's main 30-year bond was up 3/16 point, or $1.871/2 per $1,000 in face value, by late afternoon, while its yield slipped to 5.96 percent from 5.97 percent late yesterday.
Barry Hymam, senior market analyst at Ehrenkrantz King Nussbaum Inc., said the drop in stocks was caused by investment managers adjusting portfolios at the end of the quarter and worries prices are getting ahead of corporate profits.
Hymam warned that investors are "stretching the envelope." He said stock prices will be in a "severe overvalued situation" unless corporate profits strengthen.