Stocks fell as investors locked in profits from Tuesday's rally while clinging to fears that the Federal Reserve's latest increase in interest rates won't slow the nation's rapid economic growth.
The Dow Jones industrial average fell 49.24 points to close at 10,883.09.
Broader indicators also ended lower. The Standard & Poor's 500-stock index slipped 9.36, to 1410.71, and the Nasdaq composite index fell 26.13, to 3269.39.
Analysts said some of the losses came from profit-taking following Tuesday's big rally. After the Fed announced that it would raise interest rates for the third time this year, the Dow soared 171 points, the S&P 500 reached its new first closing high since July and the Nasdaq broke the closing record it set last Friday.
Stocks initially edged higher today as the Labor Department reported that the consumer price index rose a slim 0.2 percent in October, in line with analysts' expectations. The index is the government's most closely watched inflation gauge.
The market reversed course, however, as bond prices fell and the yield on the 30-year Treasury bond rose to 6.13 percent, from 6.06 percent late Tuesday. The price of the benchmark bond fell $9.68 3/4 per $1,000 invested. That weighed on stocks, which often falter when rising yields present an attractive, stable return.
An ongoing recovery in oil prices exacerbated that fear, analysts said. Crude oil futures for December reached as much as $26.70 a barrel, the highest level since January 1997, heightening fears that inflation will build in the commodities market and eventually lead to higher prices for consumers.
The spike in crude prices helped push Dow component Exxon to 80 1/4, a gain of 1-1/16. Companies that provide equipment for major oil refiners rose as well, with Schlumberger gaining 2, to 68 1/2.
But airlines, which could see profits shrink if energy costs continue to rise, were mostly lower. AMR fell 2-7/16, to 60 3/8, and Delta slid 2-5/16, to 49 7/8.
Financial stocks, which are highly sensitive to inflation, also fared poorly. American Express fell 4 7/8, to 154 5/8, and J.P. Morgan fell 2 1/2, to 139 3/4, pulling the Dow lower.
Analysts remain convinced that Tuesday's interest-rate increase will be the last until spring, when year 2000 concerns are alleviated. The Fed accompanied its move with a change to a "neutral bias," which suggests central bankers are inclined to leave rates untouched for now.
Technology stocks once again attracted investors' attention. CMGI led the Nasdaq, rising 21, to 124 3/4, after Goldman Sachs launched coverage of the stock with a "market outperform" rating. CMGI invests in Internet companies.
Oracle, a major maker of business software, rose 6 1/2, to 71. The company unveiled new software that analyzes Web site users' behavior and buying patterns, and it was optimistic about sales and profits during a semiannual meeting with analysts on Tuesday.
In after-hours trading, Bloomberg News reported, shares of Network Appliance Inc. jumped 99/16, to 113, after the maker of equipment for storing data on computer networks reported a greater-than-expected increase in quarterly earnings and announced a 2-for-1 stock split.