Stocks tumbled, with the Nasdaq composite index sustaining its worst point loss in more than a month, as investors sold shares to capture profits from the market's recent rally.
The Dow Jones industrial average fell 93.89, to 10,995.63.
Broader indicators also closed lower. The Nasdaq fell 49.69, to 3342.87, in its worst performance since Oct. 15, when the index lost 75.01. The Standard & Poor's 500-stock index fell 16.30, to 1404.64.
In a quiet session ahead of the Thanksgiving holiday, many investors appeared to be locking in profits from last week's big gains. Most oil companies, which have risen in recent sessions along with the price of crude oil, slipped back. As of 5:45 p.m., Texaco had fallen 2, to 61-5/16, and Chevron had dropped 1 1/2, to 89 5/8.
The technology-dominated Nasdaq has been on a tear lately, setting 14 new closing highs in the previous 17 sessions.
But the strongest drivers of the Nasdaq rally have been big, pricey stocks such as Intel and Cisco Systems. If those shares falter, the rest of the index typically drops back as well, said analyst Ralph Bloch of Raymond James & Associates in St. Petersburg, Fla. Today, Cisco rose 1, to 88 1/2, but Intel fell 1 1/2, to 79.
Big losses from a handful of less-well-known companies also pulled the Nasdaq lower. Extreme Networks, which makes equipment for data networks, plunged 24, to 70 1/4, after a Morgan Stanley Dean Witter analyst voiced concern about the company's fourth-quarter sales.
America Online was the most actively traded stock on the New York Stock Exchange, rising 2-9/16, to 84 1/4. AOL's 2-for-1 stock split took effect today.
The market had a muted response to the Commerce Department's report on durable goods. The department said orders for items expected to last at least three years declined by 1.3 percent last month to a seasonally adjusted $200.9 billion. Analysts had expected orders to rise by 1 percent.
The biggest decliner among Dow stocks was General Electric, which fell 2-9/16, to 137 5/8; 3M fell 2 1/4, to 96-11/16.