Stock prices were mixed as investors prepared themselves for a possible increase in interest rates but nonetheless went in search of bargains in the battered technology sector.
The Dow Jones industrial average fell 18.37 to close at 10,577.89. The index dropped as much as 131.40 earlier in the session before erasing most of the losses in the final hour.
Broader stock indicators were slightly higher after paring big losses. The Standard & Poor's 500 rose 0.55, to 1294.81, and the technology-dominated Nasdaq composite index rose 20.38, to 2432.41.
An afternoon speech by Federal Reserve Chairman Alan Greenspan helped calm a jittery market. The influential policymaker kept his remarks at a conference in Boston tightly focused on trade; he did not address interest rates.
While the Dow remained in a narrow trading range throughout Greenspan's speech, market watchers strained to catch any hints he might offer about the Fed's future course. Alan Skrainka, chief market strategist at Edward D. Jones & Co. of St. Louis, said many expect the Fed to raise rates when its Open Market Committee meets June 29.
Bond prices continued their tumble after a robust report on new-home sales. The price of the Treasury's benchmark 30-year bond fell 31 cents per $1,000 invested, and its yield was at 5.94 percent, just slightly higher than Tuesday.
A yield of 6 percent is viewed as a critical point for stocks, because at that level, higher yields make bonds a more attractive investment.
Interest rate worries depressed bank and financial stocks, with J.P. Morgan falling 2 5/8, to 130 7/8.
Investment firms, including online brokerages, also fell on rate concerns. DLJ Direct was down 5 1/8 at 33 5/8. Analysts said Merrill Lynch's announcement that it plans an online service put additional pressure on the brokerage sector. Merrill Lynch itself was down 4-9/16 at 70-11/16.
Technology firms began the day by tumbling again, but their weakened prices enticed buyers later in the session. Intel, which has slipped amid concerns about its earnings outlook, rose 1 1/4, to 51-15/16.
Yahoo rose 4-5/16, to 142 1/2, buoyed by news that Sprint's PCS Group will offer Yahoo content to users of its wireless phones.
Bookseller Barnes & Noble rose 1 1/4, to 28 5/8, after it called off its planned acquisition of book distributor Ingram Book Group. The company's online wing, Barnesandnoble.com, fell 2-13/16, to 17-3/16.
Declining issues outnumbered advancers by 6 to 5 on the New York Stock Exchange, where trading volume totaled 730.5 million shares, up from 698.6 million on Tuesday.
The NYSE composite index fell 0.78, to 620.50; the American Stock Exchange composite index fell 4.88, to 771.23; and the Russell 2000 index fell 0.72, to 436.74.