NEW YORK, JULY 18 -- The Dow Jones industrial average lost 18 points today, dragged down by a bond market sent reeling by fears of inflation and signs from Federal Reserve Chairman Alan Greenspan that interest rates would decline only modestly, if that.

The stock market's loss was also attributed to a sense of malaise over second-quarter corporate earnings, as a number of stocks suffered near free falls after announcing disappointing earnings figures.

Technician Gail Dudack at S.G. Warburg said the market was also taking stock before deciding whether to commit itself to a floor above the 3000 mark.

''There's no hard rule, but when the market has historically gotten to these big, round numbers, it tends to make people think a great deal more about what their expectations are, or ought to be,'' she said.

At the close, the Dow stood at 2981.68, down 18.07. Declines outpaced advances on the Big Board by more than 2 to 1 on moderately active volume of 168 million shares.

Polaroid stock tumbled 2 1/4 to 37 at the opening after a disappointing report released after Tuesday's close. Polaroid closed down 3 1/4 at 36. MCI Communications earnings of 67 cents per share, compared to 56 cents a year ago, were also given a cool reception, with MCI stock finishing the day off 1 7/8 at 36 1/2. Lotus Development sank 2 7/8 to 31 1/4 despite a doubling of its quarterly profit.

Some stalwart blue chips reporting earnings at the high end of expectations, such as Philip Morris and Merck, received good volume but little price play from a market that seemed more interested in glowering over its disappointments. Philip Morris eased 3/8, closing at 50 1/8 despite a 25 percent increase in profits. Merck finished up only 1/8 at 90 1/8 despite a 20 percent profit jump.

Eli Lilly closed down 3 7/8 to 85 on reports about the company's exposure to litigation based on its Prozac drug, which is said by researchers to have produced suicidal tendencies in several patients.

However, other drug stocks were not pulled down by the Lilly drop. Upjohn rose on renewed takeover rumors; Pfizer climbed on positive reports from PaineWebber and higher second-quarter earnings.

"People are intolerant of bad {earnings} reports, but by and large they're not leaving the market," Peter Canelo, an investment strategist at Bear, Stearns & Co. told Dow Jones News Service. Instead, he said, investors are moving out of stocks where earnings aren't meeting forecasts and putting their assets to work in other issues.

The Dow transports fell 16.06 to 1171.53. AMR Corp. contributed to the loss by posting a 2 7/8 deficit at 61 5/8 after reporting second-quarter net of $2.05 per share compared to $2.83 a year earlier.

Among broad stock indexes, the Standard & Poor's 500 fared slightly worse than the Dow, dropping 3.30 to 364.22, while the NYSE Composite was down 1.66 at 198.83, the Value Line down 2.08 at 287.51, the Amex Market Value down 2.33 at 362.06, and the Nasdaq Composite down 3.66 at 460.82.