NEW YORK -- For the stock market, the last four days of falling prices have been a sickening trip back in time, with yesterday's drop the biggest.
The latest slide capped an eight-week decline that has wiped out most, if not all, of the gains this year -- as much as 7 cents on the dollar.
And many on Wall Street say the decline could go far beyond the relatively benign 10 percent "market correction" that has been widely predicted since the Federal Reserve raised interest rates in February.
Many investors have been looking forward to such a correction, in effect a 10 percent-off sale, which would take the Dow to 3,580, a level not seen since early October 1993.
But some analysts are now predicting a more worrisome price drop of 15 percent or more that could extend well into autumn.
"In the recent past, corrections have been hard and swift," said Neal Litvack, executive vice president for Fidelity Investments, the nation'slargest mutual fund manager. "Now it's not clear how this market is developing."
The Dow Jones industrial average, the most widely watched barometer of stock performance, dropped 63.33 points yesterday, to 3,699.02, about where it was in early November 1993. Volume was a moderately heavy 301 million shares.
Long-term interest rates, which set borrowing costs for everyone from big corporations to the consumer on the car dealership floor, are the biggest culprit behind the recent market slide.
Yesterday, the rate on the benchmark 30-year government bondclosed at 7.05 percent, its highest since last April 2 and up from 6.98 percent Monday. The move was prompted largely by the strengthening of consumer confidence and a slight recovery in new housing sales that set off new inflation worries.
The sharp decline in the stock market has prompted some Wall Street professionals to proclaim the beginning of a bear market, a long-term decline in which investors abandon stocks.
"I've been bullish for three years," Dennis Jarrett, chief market analyst for Kidder, Peabody & Co., said. "But what troubles me is that this stock weakness isn't event-driven. Nothing in particular happened today to cause it. You may get some rigor-mortis rallies in the weeks ahead, but this spells bear."
Other professionals say the long-running bull market may still have life left. Don Hays, director of investment strategy at Wheat First Butcher Singer Inc. in Richmond, Va., said: "When first-quarter earnings start coming in strong over the next couple of weeks, they'll provide a compelling incentive for the bull market to get back on track."
Since its Jan. 31 peak, the Dow has fallen more than 279 points, or 7 percent. The broader Standard & Poor's 500-stock index and the smaller-company Nasdaq composite index have both fallen more than 6 percent from their peaks.
Yesterday, the S&P 500 fell 7.52 points, to 452.48, and the Nasdaq index fell 17.21 points, to 755.29. The American Stock Exchange market value index dropped 7.78 points, to 454.43.