Stocks drop on chip downgrade

Wall Street’s fortunes turned negative again today as a downgrade of chip makers by Merrill Lynch and retailers’ disappointing sales gave investors more reasons to doubt the strength of a business recovery. Stocks fell sharply, with the tech sector suffering the heaviest losses.

The Dow Jones industrial average closed down 172.16, or 1.8%, at 9,624.64. The loss easily wiped out the Dow’s 108.96-point gain on Wednesday, when all of the market’s major indicators finished higher for the first time in nearly two weeks.