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The Associated Press

NEW YORK (AP) — The stock market fell sharply Monday as skittish investors sized up more second-quarter earnings and braced for the likelihood that the economic slowdown will mean another spate of profit warnings.

Yet there were no major earnings disappointments that drove prices downward, a sign that investors see little reason to buy stocks. But a profit warning

“There’s absolutely no urgency. The frustration level in the marketplace is extreme,” said Scott Bleier, chief investment strategist for Prime Charter Ltd.

The Dow Jones industrial average finished the day down 152.23, or 1.4 percent, at 10,424.42.

The broader market also finished lower with the NASDAQ composite index falling 40.81, or 2.0 percent, to 1,988.56 and the Standard & Poor’s 500 index declining 19.82, or 1.6 percent, to 1,191.03.

Hopes that earnings and the economy would improve by year end have dimmed in recent weeks as more than 800 companies warned of shrinking profits and many others said business is so uncertain they can’t make accurate projections.

“We are all starved for pieces of good information to make us feel better, but that information is just not there yet,” said Charles White, portfolio manager for Avatar Associates.

But market observers were doubtful any losses — or gains — would be long lasting, given how the market has reacted recently, canceling out its losing and advancing sessions as companies report earnings.

Analysts also believe the market could still trend higher in the fourth quarter, when companies’ profits will look better when compared with the weakened results of the last three months of 2000.

“The economy is in a rough road. You are still making comparisons over a good (quarter) last year,” said Al Mirman, market strategist at V Finance in Sarasota, Fla.

Among Monday’s biggest losers were companies that warned of tough business ahead. Lexmark International, which beat second-quarter expectations but reduced its forecast for the third quarter, slid nearly 64 percent, down $9.14 at $49.51. Goodyear Tire, which met expectations but said production must be curtailed, fell $1.80 to $29.84.

Copyright 2001 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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