Wall Street resumes its slide

Wall Street tried but failed today to extend a one-day rebound, but succumbed to late selling on questions about AOL Time Warner’s accounting and pessimism about second-quarter earnings reports.

The Dow Jones industrial average had its sixth triple-digit loss in nine sessions, while the Standard & Poor’s 500 index closed below 900 for the first time in nearly five years. Analysts said the pullback reflected investors’ continuing lack of confidence.

The Dow closed down 132.99, or 1.6%, at 8,404.49, according to preliminary calculations, after rising as much as 79 points earlier in the day. The Dow has now fallen 975.01 in nine sessions.

The losses were more intense in broader stock indicators. The S-and-P 500 was down 24.47, or 2.7%, at 881.57, its lowest finish since October 27, 1997 when it fell to 876.99. The Nasdaq composite index lost 40.30, or 2.4%, closing at 1,356.95.

All three indexes closed higher yesterday for the first time in nearly two weeks, but analysts weren’t surprised that the market faltered.

‘‘The general public hasn’t made money in the stock market for two years now, so there is an acceleration of redemptions in mutual funds and stocks as investors switch to other types of investments,’’ said Bill Meade, managing director, RBC Capital Markets.

Indeed, investor confidence remains fragile because of the market’s weak performance and the accounting scandals. At the same time, prospects for a vigorous economic recovery have all but disappeared. Most analysts now say the economy and business profits will at best grow modestly.

As a result, many investors and institutions have been selling stocks and shifting into more conservative investments. The losses tend to intensify late in the session. And the scarcity of buyers for stocks make stock prices more susceptible to sudden, sharp declines.

AOL Time Warner fell 66 cents to dlrs 12.45 on a Washington Post story that questioned its bookkeeping practices. The article unnerved investors, who have watched stocks slide for months now on similar concerns at other companies. AOL Time Warner denied any wrongdoing. Late in the day, the company said chief operating officer Robert Pittman was leaving his post as part of a management shake-up.

Economic news was mixed. The Labour Department said new claims for unemployment insurance fell last week to the lowest level in 17 months. But the Conference Board said its Index of Leading Economic Indicators held steady in June.

The figure matched analyst expectations but raised concerns that the recovery’s momentum is fading as consumer confidence falters because of corporate accounting scandals.

Wall Street also might have been dismayed by a Federal Reserve survey showing manufacturing activity slowed considerably in the mid-Atlantic region in July and that manufacturers were less optimistic about the future.

Analysts said much of the market’s attention was focused on second-quarter earnings reports, which began in earnest this week.

‘‘A lot of investors are waiting to get more earnings data, to really ascertain what the second quarter looked like and get some idea of how the third and fourth quarters are going to be before making any big moves,’’ said Stephen Massocca, president of Pacific Growth Equities.

In the tech sector, IBM advanced dlrs 1.77 to dlrs 72.46 after reporting second-quarter results late Wednesday that were slightly ahead of expectations despite a 97% drop in profits. The company took a dlrs 1.4 billion charge on the sale of its hard disk business, restructuring and layoff costs.

And Sprint’s wireline division, FON, gained 56 cents to dlrs 12.26 after beating quarterly expectations. Investors also boosted shares of Sprint’s wireless business PCS group up 50 cents to dlrs 5.50 despite reporting a wider-than-expected loss.

But Siebel Systems tumbled dlrs 2.12 to dlrs 9.62 after reporting a 61% decline in profits that missed Wall Street’s estimates. The business software maker also announced more than 1,100 job cuts.

Disappointing quarterly results also sent medical products company Baxter International down dlrs 11.41 to dlrs 32. And Eli Lilly dropped dlrs 2.36 to dlrs 48.54 after the drug maker met second-quarter expectations but indicated manufacturing problems could delay up to five new drugs.

Declining issues led advancers 2 to 1 on the New York Stock Exchange. Volume came to 1.72 billion shares, compared with 1.93 billion shares Wednesday.

The Russell 2000 index fell 12.97 to 396.72.