The continued threat of higher interest rates pushed stocks lower today in slow trading. High-priced technology shares fell most steeply.

The Dow Jones industrial average fell 47.80 points, to 10,863.16. After a few sluggish moves into positive territory at midday, the blue-chip index fell back and extended the losses of last week, when the Dow dropped 298.88 points, or 2.7 percent.

Broader stock indicators were lower as well. The Standard & Poor's 500-stock index slipped 9.18, to 1347.76, and the Nasdaq composite index, dominated by technology stocks, fell 73.21, to 2619.19.

Nervous investors have begun to believe that the Federal Reserve will raise interest rates as early as next month in an effort to hold off inflation. Fed Chairman Alan Greenspan, who raised that possibility in congressional testimony Thursday, will address a Senate panel on Wednesday, and analysts said it is unlikely that stocks will muster much strength before then.

John H. Shaughnessy, chief investment strategist at Advest, said Greenspan appears to be laying the foundation for another modest rate increase, following the quarter-point increase instituted last month.

"Given his remarks, financial markets should tend not to be very surprised when the Fed moves to raise short-term rates in reaction to very robust economic or employment data," he said.

Later this week, the government will release statistics on employment costs and on the gross domestic product, which could provide a clearer indication of whether inflation is encroaching on the economy.

In the bond market, the prospect of higher interest rates pushed prices lower, driving yields higher. The price of the benchmark 30-year Treasury bond fell 94 cents per $1,000 invested while its yield rose to 6.03 percent from 6.02 percent on Friday.

Technology shares were mostly lower. Analysts said those stocks, which drove the Nasdaq to a string of records earlier this month, are now falling prey to profit-taking as investors try to lock in their gains.

Microsoft fell 2 5/8, to 87 5/8, and Hewlett Packard dropped 2-1/16, to 105-11/16, the weakest performer among Dow components.

America Online lost ground as several top executives, including chairman and chief executive Steve Case, sold 4 million shares. AOL, which has been battling several rivals over instant-messaging technology, fell 7-13/16, to 100 1/8, as the most active issue on the New York Stock Exchange.

Merger activity was relatively quiet, but new deals provided the market with scattered gains. Host Marriott Services rose 5-47/64, to 15-31/64, after Italy's Autogrill said it will offer $15.75 a share to acquire it.

American Express got a modest boost from its second-quarter earnings report. Shares rose 15/16, to 136 1/2, after the company posted a 12 percent increase in profit for the quarter. American Express's results slightly beat analysts' estimates, according to research firm First Call.

Declining issues outnumbered advancing ones by more than 2 to 1 on the NYSE, where volume totaled to 616.2 million shares, down from 635.7 million on Friday.

The NYSE composite index fell 2.97, to 635.90; the American Stock Exchange composite index fell 5.50, to 790.79; and the Russell 2000 index of smaller companies fell 5.51, to 442.87.