Stock prices, which had been increasing steadily for the better part of the last two months, dropped sharply today in the face of a renewed rise in interest rates, anticipated declines in second-quarter corporate earnings and tax-cut fever in Congress.
The Dow Jones Industrial Average of 30 stocks fell 13.91 points to close at 867.92.
Analysts said there is no major reason for the sudden price decline.
"The factors that were driving the market up are losing their force. The market is giving greater attention to the signs of a recession," according to Monte Gordon of the Dreyfuss Group.
Gordon said that a decline could have been expected in any event because of the sustained rally that dates back to April. After a long rally, there always is a "correction," Gordon said.
The price decline probably was delayed because institutional investors, such as pension funds and insurance companies, were heavy buyers in recent days -- as they usually are near the end of a an accounting quarter, he added.
Bond prices, which had been climbing sharply as well because of falling interest rates, turned down last week, although they rallied slightly today.
Despite today's steep decline in the Dow average, there was no heavy sell-off of stocks. Volume was 29.9 million on the New York Stock Exchange, lighter than Friday's 33.1 million and much less than the 50 million shares that changed hands, on average, each day during the early months of the year.
The New York Stock Exchange index closed down 1 point at 65.34. On the American Stock Exchange, the Index was down 3.15 points at 293.61.
One thousand sixty-five shares on the NYSE decline in price, while only 363 gained; 408 stocks on the Amex fell, while 176 increased.