Continuing signs of oil price cuts sent stock market indicators tumbling while the bond market rose sharply in an active day on Wall Street.

With oil stocks in particular leading the declines, the Dow Jones Industrial Average fell by 12 1/2 points to 1080.40, its lowest point in more than two weeks. Many stock analysts suggested that the growing uncertainty about oil prices could pull the leading stock indicators down during the next few weeks.

Great Britain, Nigeria and other oil exporters cut prices over the weekend, and representatives of several OPEC member nations are meeting in Saudi Arabia in an effort to block an international petroleum free-for-all.

The Nigeria cut, by $5.50 a barrel, "has raised the specter of a free fall in oil prices," said Monte Gordon, research director at The Dreyfus Corp. Gordon and other analysts suggested that such a sharp fall in oil prices could bring new debt problems for international financial markets, already strained by the large debts of borrowing countries. In particular, analysts cited developing oil-exporting nations, such as those in Central and South America.

Oil stock prices were the victim of the uncertainty, as Atlantic Richfield dropped 2 3/8 to 42 3/4, Standard Oil of California fell 1 3/8 to 34 and Exxon fell 7/8 to 28 1/2. With the prospect of lower fuel costs, airline stocks moved up, as Pan Am rose 5/8 to 5 5/8 and American Airlines rose 1 3/8 to 22 5/8.

Technology stocks, major beneficiaries of the bull market, fell, largely in anticipation of a retreat in stock prices. International Business Machines fell by 1 3/8 to 97, while Texas Instruments, which reported problems with a transformer for a home computer and the prospect of lower-than-anticipated fourth-quarter profits, fell 10 5/8 to 161.

The day's news also sent the bond markets up. With the oil-price cuts potentially negating other inflationary factors, long government bonds rose more than a point and most corporate issues rose between one half and a full point. The Dow Jones 20-bond average rose by 0.40 point.

On the New York Stock Exchange, 554 stocks rose, while 1,110 stocks declined. Volume rose to 84.08 million shares from 77.4 million Friday. The New York composite index fell 1.38 points to 84.06, as the average price per share fell 55 cents.

The American Stock Exchange index was down 9.95 points to 374.04, with volume down slightly to 8.17 million shares from 8.44 million Friday. On the Amex, prices rose for 208 issues and fell for 427.

Standard & Poor's index of 400 industrials dropped 3.02 points to 163.36, and S&P's 500-stock composite index was down 2.52 points at 145.48. The Nasdaq composite index for the over-the-counter market dropped 2.11 points to 259.18.