A lot of dreams are dying on Wall Street these days. Investors who hoped that rising stock prices would help them pay for college educations and comfortable retirements are watching the value of their nest eggs shrink dramatically. Stock brokers and investment managers who depend on investor confidence to make a living are watching their customers cashing in their stocks and putting what's left in money market funds.

The third quarter of 1990, which ended Friday, will be remembered for inflicting enormous pain on investors in a short period of time. It seems hard to believe that it was in mid-July -- only 11 weeks ago -- that the Dow Jones industrial average was within a quarter point of closing above the historic 3,000 mark.

Unfortunately, euphoria tends to vanish quickly in this business. And when the third quarter ended Friday, the Dow was down to 2,452.48, a loss of 14.87 percent for the quarter, and a loss of 10.92 percent for the first nine months of 1990.

Unhappily, many individual stocks, especially financial stocks, are far lower today than they were after the October 1987 market crash.

Chalk it up to a steadily slowing economy that looks much like a recession, growing cracks in the safety of the banking industry and, of course, the economic shock of the Middle East crisis and swiftly rising oil prices.

The first half of 1990, as predicted, was a lackluster time for stocks. During January, February and March, in a move that began in late 1989, stocks dropped across the board. In the second quarter of April, May and June, stocks began to rise again, with blue-chips leading the way. As a result, prices at the end of the first half were generally back where they started in January.

The third quarter of July, August and September was a debacle. The Standard & Poor's 500 was off 14.4 percent for the third quarter, 12.7 for the nine months. The New York Stock Exchange composite index fell 14.0 percent for the quarter, 13.3 percent for the year.

The American Stock Exchange index was off 14.4 percent for the quarter, 17.7 percent for the nine months. The Nasdaq composite lost 25.2 percent in the quarter, 23.5 percent for the year thus far.

Financial stocks, of course, have been sinking for months. As of Friday, the NYSE financial index was off 28.4 percent so far this year. For the same period, the Nasdaq bank index was off 36.0 percent.

Once again, stocks in the Baltimore-Washington-Richmond region were hit harder than the stocks that make up the national averages. The 30 local blue chips that make up the Johnston, Lemon & Co. index fell 21.5 percent in the third quarter and are off 29.3 percent so far this year.

Mutual funds that invest in area stocks also were hurt.

The Growth Fund of Washington, sponsored by Johnston, Lemon was off 20.0 percent in the quarter, 23.3 percent for the year. The Washington Area Growth Fund, sponsored by the Calvert Group, was off 31.7 percent and 36.4 percent for the nine months. And the Southeastern Growth Fund, run by Wheat, First Securities was off about 22 percent for the quarter and about 23 percent for the year.

Of the 170 stocks in the Washington Business area stock table, only 21 stocks were ahead for the year, while 144 were losers and five showed no change.

Here are the results for Washington-area stocks trading at $2 or more, with the prices as of Jan. 1 and at the end of the third quarter on Friday, along with the percentage of gain or loss for the first nine months of 1990.

First, the winners:

1. Alpha 1 Biomedicals Inc. of Washington ($1.28, $3.31, up 158.6 percent).

2. Webster Clothes Inc. of Baltimore ($2.25, $5.38, up 139.1 percent).

3. PHP Healthcare Corp. of Alexandria ($7.75, $12.50, up 61.3 percent).

4. CACI International Inc. of Arlington ($2, $2.81, up 40.5 percent).

5. Allstate Financial Corp. of Arlington ($7, $8.25, up 17.9 percent).

6. Life Technologies Inc. of Gaithersburg ($13.75, $16.00 up 16.4 percent).

7. Reynolds Metals Co. of Richmond ($53.63, $62.00, up 15.6 percent).

8. General Kinetics Inc. of Rockville ($6, $6.75, up 12.5 percent).

9. American Management Systems Inc. of Arlington($11.25, $12.63, up 12.3 percent).

10. ERC Environmental and Energy Services Co. Inc. of Fairfax ($10.75, $11.75, up 9.3 percent).

11. Penril Corp. of Gaithersburg ($5.30, $5.75, up 8.5 percent).

12. Smithfield Foods Inc. of Smithfield, Va., ($12.25, $13.25, up 8.2 percent).

13. American Capital and Research Corp. of Fairfax ($8.63, $9.13, up 5.8 percent).

10. Micros Systems Inc. of Beltsville ($3.75, $3.88, up 3.5 percent).

15. JHM Mortgage Securities L.P. of McLean ($6.50, $6.63, up 2.0 percent).

Here are the losers:

1. Jiffy Lube International Inc. of Baltimore ($18.80 after adjustment for a 10-for-1 reverse split on Sept. 11, $4.00, down 78.7 percent).

2. Microlog Corp. of Germantown ($9.50, $2.25, down 76.3 percent).

3. MNC Financial Inc. of Baltimore ($22.13, $6.25, down 71.8 percent).

4. Piedmont Federal Corp. of Manassas ($14.13, $4.25, down 69.9 percent).

5. WorldCorp Inc. of Herndon ($13.25, $4.00, down 69.8 percent).

6. Marriott Corp. of Bethesda ($33.38, $10.25, down 69.3 percent).

7. Systems Center Inc. of Reston ($20.88, $6.50, down 68.9 percent).

8. Data Measurement Corp. of Gaithersburg ($6.50, $2.13, down 67.2 percent).

9. Ameribanc Investors Group of Annandale ($8.25, $2.75, down 66.7 percent).

10. Signet Banking Corp. of Richmond ($32.13, $11, down 65.8 percent).

11. Columbia First Bank of Arlington ($14, $5.50, down 60.7 percent).

12. Harman International Industries Inc. of Washington ($20.25, $8.38, down 58.6 percent).

13. Dominion Bankshares Corp. of Roanoke ($19.13, $8.13, down 57.5 percent).

14. James Madison Ltd. of Washington ($5.88, $2.50, down 57.5 percent).

15. Insituform East Inc. of Landover ($6.38, $2.75, down 56.8 percent).

As the reader will notice, the losses are far more dramatic than the gains. Except for Alpha 1 Biomedicals, Webster Clothes and PHP Healthcare, most of the other 12 "winners" showed very modest gains. On the other hand, all of the losers dropped more than 50 percent of their value.

Alpha 1 Biomedicals moved up after it announced that it was part of a joint venture to begin testing a potential AIDS vaccine. Webster Clothes' shares jumped after the clothing chain agreed to be acquired by Edison Brothers Stores Inc. of St. Louis for about $6 a share, a deal worth $19.2 million.

PHP Healthcare, whose stock gained 82 percent last year, also has been strong this year. PHP is in the business of providing medical care to federal, state and local agencies, especially to the Department of Defense.

One of the most dramatic declines came in the stock of Marriott Corp., down 69.3 percent for the nine months. Marriott has been forced to reduce its plans to build new hotels because of the slowdown in the real estate and hotel markets. Also declining was Microlog Corp. of Germantown, which makes voice-messaging systems.

Jiffy Lube, whose stock was worth $1.88 on Jan. 1, had a reverse split in September of 10 shares for one. It closed Friday at $4.

Hefty declines also have been felt by several major banks, including MNC Financial Inc. and Signet Banking Corp., and by several thrifts, including Piedmont Federal Corp.

Indeed, because the list of winners and losers is limited to stocks trading at more than $2, it omits Perpetual Financial Corp. of Vienna, the largest thrift in the Washington area. Perpetual, which once sold as high as $19.25, is down to $1.25.

Trustbank Savings FSB of McLean, whose shares once traded at $19.41, is selling at $.25 a share. And Investors Financial Corp. of Richmond, also a thrift, once saw a high of $18.25 but is now trading at $1.00.endquad