NEW YORK — Wall Street ended a relatively calm session with a moderate loss Tuesday as investors, while happy with the government’s plans to spend $250 billion to buy stock in private banks, decided to cash in profits from the previous day’s massive advance as they refocused their attention on the economy.
It was the first time in nine sessions that the Dow Jones industrial average didn’t close up or down in triple digits although it did swing in a 700-point range. The Dow closed down 76 points a day after its record 936-point jump.
Big advances by many bank stocks helped offset some of the declines in the Dow and the Standard & Poor’s 500 index, giving them a better showing for the day than the Nasdaq composite index, which fell more than 3 percent. But the technology-dominated Nasdaq also lagged ahead of a profit report from Intel Corp., as investors were reminded of the troubled economy and its effect on corporate earnings.
Profit-taking set in after the Dow opened with a surge of more than 400 points. Wall Street is expected to see jittery trading in the weeks and perhaps months ahead because of economic worries; stocks tend to ratchet up and down when they’re recovering from a fall like the one Wall Street has suffered in the past two weeks.
Investors had snapped up stocks Monday in anticipation of the government’s plan. President Bush said Tuesday the government will use a portion of the $700 billion financial bailout passed at the start of the month to inject capital into the nation’s major banks, which have been slammed by souring mortgage investments.
The move follows a similar one announced Monday by European governments to invest about $2 trillion in their own troubled banks.
The revised bailout plan differs from the original in that it aims to recapitalize banks, not just buy the troubled assets off their books at prices that could leave the banks with losses.
The Dow fell 76.62, or 0.82 percent, to 9,310.99. The S&P 500 index fell 5.34, or 0.53 percent, to 998.01, and the Nasdaq fell 65.24, or 3.54 percent, to 1,779.01.
