Blue chips slide on profit-taking

Wall Street stocks have fallen more than 150 points as investors cashed in their winnings from the market's spectacular two-session rally.

The Nasdaq index proved steadier, its losses mitigated by optimism about earnings prospects at bellwether Intel. Analysts said the market's overall mood was cautious but still showing signs of bullishness.

The Dow closed down 153.41, or 1.5%, at 10,433.41, giving back less than a third of the 480 points gained during the previous two sessions.

Broader stock indicators were mixed. The Nasdaq advanced 6.98, or 0.4%, to close at 1,866.30, while the Standard & Poor's 500 index fell 7.70, or 0.7%, to 1,146.14.

Blue chips fell on losses in retailers including Wal-Mart, which fell $2.22 to $60.76. Home Depot slid $2.40 to $47.50, a 4.8% loss. The sector had been steadily moving higher on anticipation it would benefit when the economy stabilised.

Consumer goods' companies also fell. Procter & Gamble lost $1.92 to $85.06.

Tech stocks were more mixed. Microsoft dropped 22 cents to $63.08. Intel advanced 85 cents to $32.70 after Morgan Stanley upgraded the stock to "strong buy" from "outperform", citing the prospect for strong personal computer sales this year.

Financial stocks were also higher, reflecting expectations that an improving economy will mean higher profits. Citigroup rose 9 cents to $47.70.

Some steel issues got a lift ahead of President George Bush's announcement that he was placing tariffs on several types of imported steel to aid the US industry. Bethlehem Steel gained 7 cents, or 13%, to 58 cents after the plan was announced.

Advancing issues narrowly led decliners on the New York Stock Exchange. Volume totalled 1.52 billion shares, compared with 1.61 billion on Monday. The Russell 2000 index gained 0.41 to 487.59.