NEW YORK, NOV. 6 -- The stock market made a sudden reversal this afternoon as fears over the return of computer program trading sparked a last-minute selloff that knocked the Dow Jones industrial average for a 26.36-point loss.

The average, which had been up as much as 20 points, ended at 1959.05, down 34.48 points for the week.

Volume was 228 million shares, up from 226 million Thursday.

Nervous traders quickly cashed in the day's profits after the New York Stock Exchange announced, a half hour before the close of trading, that it would again permit program trading.

The computer-based trading involves large blocks of stock and has been blamed by many for exacerbating the market's swings.

The exchange also announced that it was delaying its return to normal trading hours.

The NYSE said trading would close at 3:30 p.m. through Wednesday, at which time it will set hours for the rest of the week.

The shortened day was introduced because of the massive volume that came with the market collapse.

The stock market lately has been undermined by doubts over Washington's ability to cut the federal budget deficit. But stocks closed broadly higher Thursday as interest-rate cuts around the world appeared to lessen the chances of a global recession.

Budget-cutting talks continued in Washington, but no agreement was reached.

Republican lawmakers offered White House and congressional negotiators a plan to cut the deficit by $75.5 billion over two years.

Analysts said West Germany's decision on Thursday to lower two official interest rates, after a similar move by Britain's central bank, has put additional pressure on Washington to cut the budget.

The government's employment report, which showed a scant rise in the jobless rate to 6 percent in October from 5.9 percent in September, also revealed a rise in the number of new jobs.

"It got some people thinking that perhaps the stock market is not a harbinger of economic things to come," said trader Bill Bee with Prudential-Bache Securities.

Demand for U.S.-built cars is expected to wane in the next two years and investors should steer clear of most car stocks, said Jean-Claude Gruet, car industry analyst at Salomon Brothers.

General Motors fell 1 3/8 to 58 3/4, Chrysler slipped 1 1/2 to 24 3/8 and Ford, the only Detroit auto maker Gruet still recommends, fell 2 7/8 to 75 5/8.

The dollar yesterday hovered above the record lows it hit Thursday against some of the stronger currencies.

Semiconductor shares tumbled after Merrill Lynch analyst Thomas Kurlak reduced his estimates for the industry's earnings next year. Texas Instruments fell 5 1/2 to 45 1/2 and Motorola slipped 1 3/4 to 44 1/4.

Among computer shares, IBM fell 4 1/4 to 119 1/2 and Cray 2 3/8 to 72 1/2.

Greyhound rose 7/8 to 25 1/4 after analysts said the stock was undervalued in light of the company's assets.

Scott Paper shares rose 3/4 to 66 on news of a strike settlement.

The broad-based NYSE composite index fell 1.77 to 140.04, while the Standard and Poor's 500 index slipped 4.07 to 250.41.

But share prices finished higher on the American Stock Exchange. The Amex average rose 0.18 to 255.23, limiting its losses for the week to 5.13.

The Nasdaq composite index also rose 0.22 to 326.40.