Stocks fall modestly on profit-taking

Profit-taking sent stocks modestly lower yesterday.

Analysts said Wall Street, which enjoyed healthy gains in the high-tech sector last week, was due for a pullback.

The Dow Jones industrial average closed down 9.35 at 10,578.24. The Nasdaq composite index slipped 12.47 to 2,757.91, while the Standard & Poor's 500 index rose 0.35 to 1,342.90.

Dell Computer, which fell 13 cents to $25.50, is the latest high-profile technology company to lower its earnings forecast because of the slowing economy and slumping consumer confidence.

So far this year, the market has had little reaction to similar warnings, reflecting many investors' belief that weak earnings were already priced into stocks.

The Federal Reserve's decision to lower interest rates earlier this month - and expectations that it will lower rates again next week - have made investors more confident even as companies release disappointing earnings outlooks.

American Express fell $3.63 to $45 after releasing earnings that met expectations, but reducing its yearly forecast, citing weak market conditions.

Investors, who had bid tech prices higher in the past few sessions, gravitated toward safer havens such as energy and health care stocks after shunning them last week. Duke Energy rose $1.19 to $74, while Pfizer was up 75 cents at $42.13.

Tech stocks were mixed, with losses primarily coming from profit-taking. Dow component IBM fell $2.69 dollars to $108.56, ending a winning streak that began last week. But investors didn't completely abandon the sector. Cisco Systems was up $1.06 at $41.44.

Industrial and manufacturing stocks gained as well, with 3M rising $2.13 to $108.88. And Amgen gained $7.63 to $67.63, on a court ruling that preserves the biotech company's monopoly on its top-selling drug, Epogen.