Wall Street today had trouble deciding whether to be thrilled by an impressive improvement in productivity or chilled by warnings that stock prices have been going up even faster than productivity--or any other measure of the economy.

Stocks stumbled at the opening because of fresh downgrades of Hewlett Packard Corp. and Walt Disney Co. and growing disillusionment with AOL Time Warner.

Toss in downgrades of the entire computer, chip and communications equipment markets and the tech sector was sunk for the day.

The tech-heavy Nasdaq Stock Market composite index fell more than 18 points, closing at 1,430.35, down about 1.3 percent. The Dow Jones industrial average, which was up until late in the day, closed down 5 points at 8,737.85. The Standard & Poor's 500 stock index also suffered a minor loss, slipping 3 points to 917.58.

Despite concerns about the market outstripping the economy, the productivity numbers were too good to ignore. That crucial measure of economic output grew at a 5.1 percent annual rate in the third quarter, the Commerce Department reported.

The trouble is, the major stock indexes have jumped about 20 percent in the past couple of months--a far bigger increase than is justified by improvements in the economy.

Morgan Stanley pointed that out today, joining with Merrill Lynch in cautioning investors that the recently run-up in stocks had made the market speculative, particularly the tech stocks.

That concern was reinforced by an earnings warning from Hewlett Packard and another day of doubts--and downgrades--of AOL. AOL shares fell another 37 cents and have lost 17 percent of their value in the past two days since the company warned that its advertising revenues could fall as much as 50 percent next year.

The stock is so cheap, some analysts calculate, that investors who buy it are paying only for the profitable Time Warner part of the business and getting AOL for free. Others contend that even at that price, AOL is no bargain, because high speed Internet connections are going to make AOL obsolete.

The most damning assessment of AOL was delivered by the Wall Street Journal's "Ahead of The Tape" column, which called AOL "the Betamax of the Internet."