S&P 500 Leads on the Downside as Stocks Close Broadly Lower

The Treasury market returned some of its recent gains after staging a sharp rally yesterday.
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With a sentiment of, "OK, that's enough, for now," traders dumped stocks, sending the major market gauges tumbling in the wake of the market's recent surge.

The big-cap

S&P 500

surrendered the most ground among the major stock proxies, while the blue-chip

Dow Jones Industrial Average

came in second in the red. Some analysts said the market had become overbought in light of the market's recent rally and was due to take a tumble.

In tech news,

Cisco

(CSCO) - Get Report

confirmed it has agreed to acquire privately held

Cerent

of Petaluma, Calif., and

Monterey Networks

of Richardson, Texas, for a combined $7.4 billion in stock. Cisco, the world's largest maker of computer networking equipment, was up 5/16 to 68 15/16 and was most active on the

Nasdaq Stock Market

with 35.7 million shares changing hands.

TSC's

Jim Seymour wrote about Cisco's takeover of Cerent in a piece

this morning.

Elsewhere in the news,

Knight/Trimark Group

(NITE)

soared 6 to 40 after it announced that by mid-October it will clear and settle all of its securities transactions through

Broadcort Capital

,

Merrill Lynch's

(MER)

clearing and settlement unit.

TSC

reported on the move

Tuesday.

The Treasury market returned some of its recent gains after staging a sharp rally yesterday.

On the

New York Stock Exchange

, decliners beat up on advancers 1,785 to 1,161 on 713.8 million shares. On the Nasdaq, losers trumped winners 2,122 to 1,708 on 1.09 billion shares.

On the NYSE, 51 issues set new 52-week lows while 36 touched new highs. On the Nasdaq, 112 issues set new 52-week highs while new lows totaled 59.

On the Big Board,

Bank One

(ONE) - Get Report

was most active with 17.2 million shares as it continued to decline in the wake of its recent profit warning. It was off 1/2 to 42 1/2.

Market data above are preliminary. Updated numbers and analysis will follow in the Market Roundup

Earlier...

3:01 p.m.: Broad Slump Continues but IPOs Keep Soaring

Traders were sending shares of

bamboo.com

(BAMB:Nasdaq) and

ImageX.com

(IMGX:Nasdaq) to ice-capped heights in their first day of trading.

1:53 p.m.: IPOs Jumping as Major Indices Slump Into the Red

Like a kid with bad posture, stocks were slouching underwater early this afternoon while stocks debuting on Wall Street were doing an upside explosion.

1:18 p.m.: Midday Musings: Cloudy Market Conditions Prevail on Soggy Wall Street

12:05 p.m.: Dow, S&P 500 Lower as Treasuries Take a Hit

Like a kid with bad posture, stocks were slouched in the red late this morning along with the Treasury market, which has slumped in the wake of its recent huge run-up.

11:11 a.m.: Tech-Laden Nasdaq Clings to Positive Territory

In the wake of yesterday's relatively narrow rally which sent the

Dow Jones Industrial Average

to close at an all-time high, major stock proxies were mostly weaker as the tech-laden

Nasdaq Composite Index

was managing another advance.

9:56 a.m.: Stocks Open Mixed as Telecom Talk Pushes Vodafone Higher

Major market gauges were mostly softer early as traders, always introspective by nature, took a moment to reflect on yesterday's late gains.