Wall Street staggered through another volatile session Tuesday, with the Dow Jones industrials bouncing between gains and losses before surrendering in late afternoon and closing with their fourth straight loss.
Tech stocks suffered even sharper losses , and financial stocks were hit hard by questions about bankers' possible role in the collapse of Enron.
Some stocks including Dow components managed to hold on to gains for much of the session. But analysts said that after weeks of selling, there are few incentives to do much buying. With confidence continually eroding due to corporate ethics scandals, most investors are unwilling to make many bets.
The Dow ended the session down 82.24 at 7,702.34, for a four-session loss of 840.14.
The Nasdaq composite index, heavily populated by high-tech stocks, dropped 53.60 to 1,229.05. The Standard & Poor's 500 index, one of the broadest market measures, but one with a sizeable tech representation, fell 22.15 to 797.70; it was the S&P's first close below 800 since April 1997.
In percentage terms, the Nasdaq had the worst performance, falling 4.2 percent compared to the Dow's 1.1 percent and the S&P's 2.7 percent.
"We're searching for a bottom here," said Will Braman, chief investment officer, John Hancock Funds. "But sentiment is still bad, about as bad as it gets."
Indeed, it was no surprise that the market had difficulty holding on to gains. With investors highly mistrustful after more than nine weeks of losses, stocks have quickly relinquished even the smallest of advances.
Financial stocks slid for a second straight session as a Senate subcommittee investing the Enron collapse heard testimony from J.P. Morgan Chase and Citigroup. A Senate investigator testified that major investment banks gave Enron Corp. multimillion-dollar loans that helped the now-bankrupt company disguise its true financial condition. Both institutions have denied any wrongdoing in their handling of Enron business.
Citigroup tumbled $5.04, or 15.7 percent, to $27, while J.P. Morgan lost $4.44, or 18.1 percent, to $20.08.
And Tyco fell $1.20 to $10.65 after reporting quarterly results in line with expectations, but saying it might miss the mid August deadline set by the SEC for executives to sign off on financial results. The company said it first wants to complete an investigation of the dealings of its former chairman L. Dennis Kozlowski, and does plan to eventually comply.
Wall Street was also focused on second-quarter earnings reports.
The already battered telecommunications sector retreated further on discouraging results from two of its most high-profile companies. AT&T fell 72 cents to $8.80 on a $12.7-billion second-quarter loss due in part to a drop in the value of its cable TV business. Lucent lost 45 cents to $1.65 after reporting a quarterly decline of $7.9-billion and another 7,000 job cuts.
Novellus Systems dropped $2.80 to $26.75 after releasing results that met expectations but lowering forecasts for its current quarter. The news was better for consumer products companies.
Personal care products maker Kimberly-Clark rose $3.01 to $56.01 after reporting profits slightly ahead of expectations. Investors also rewarded Gillette, which rose $1.91 to $30.91, on better-than-expected results following a 26 percent gain in profits.
Individual stocks have been able to post gains over the past few sessions on generally satisfactory results. But unlike earnings reporting seasons of the past, the good news hasn't been able to lift the broader market.
"It will take a fairly long sequence of positive news to really turn sentiment, and that may not happen until next year," said Brian Bruce, director of global investments, PanAgora Asset Management.
On Monday, the major indexes continued their descent, with the Dow falling to its first close below 8,000 since October 1998 and the Nasdaq and S&P dropping to their lowest closes since May 1997.
Declining issues led advancers 5 to 1 on the New York Stock Exchange Tuesday in what was its third busiest session ever. Volume came to 2.42-billion shares, compared with 2.17-billion shares Monday. The Russell 2000 index slipped 15.66, or 4.1 percent, to 363.99.
Overseas, Japan's Nikkei stock average rose 0.3 percent. In Europe, Germany's DAX index fell 4.8 percent, Britain's FTSE 100 slipped 1 percent, and France's CAC-40 dropped 2.5 percent.