NEW YORK (CNN/Money) - U.S. stocks slipped Wednesday morning as accounting questions, corporate concerns and continued violence in the Middle East kept investors from snapping out of the doldrums.

At 10:47 a.m. ET, the Nasdaq composite index fell 18.36 to 1,786.04. The Dow Jones industrial average slid 89.75 to 10,223.96. The Standard & Poor's 500 index lost 9.35 to 1,127.41.

The markets continued to be dogged by the accounting questions that have plagued stocks since the Enron scandal first came to light. The Securities and Exchange Commission has expanded its investigations to a number of other companies, including Adelphia Communications and Williams Cos., according to a published report.

Shares of PeopleSoft (PSFT: down $1.15 to $24.01, Research, Estimates) continued to sell off after the company issued a warning about its first-quarter results on Tuesday. But Sun Microsystems (SUNW: up $0.01 to $8.95, Research, Estimates) and IBM (IBM: down $0.93 to $100.02, Research, Estimates), two names that had suffered brokerage naysaying Tuesday, received some positive marks in a Merrill Lynch note Wednesday.

Among the Dow's top decliners was Caterpillar (CAT: down $1.70 to $54.70, Research, Estimates), the industrial equipment maker, which was downgraded by J.P. Morgan to "long-term buy" from "buy."

Turmoil in the Middle East continues to be a factor for U.S. investors. In the latest development, the Israeli military has moved into the city of Bethlehem, with some Palestinian civilians hiding out inside the Church of the Nativity, a monument to the birth of Jesus Christ.

However, after hitting a six-month high Tuesday, Brent crude oil futures fell 41 cents to $27.25 in London. Gold futures also dropped more than $2 an ounce, but held above the important $300 level.

In the day's economic news, the Institute of Supply Management's report on services sector activity in March showed a decline to 57.3 percent, a little above the 57 reading economists were expecting and a sign that expansion in non-manufacturing businesses continued last month.

Markets in Europe were lower at midday, while Asian markets closed mainly higher.

Treasury prices were little changed, with the ten-year note yield up to 5.35 percent.

Market breadth was negative. On the New York Stock Exchange, losers topped winners 8-to-5 as 328 million shares traded. On the Nasdaq, decliners edged advancers 3-to-2 as 526 million shares changed hands.

Adelphia Communications (ADLAC: down $1.89 to $9.94, Research, Estimates) confirmed that the SEC is conducting an inquiry into some of its agreements and has asked the cable television company to provide clarification and related documents.

Williams Cos. (WMB: down $1.31 to $22.86, Research, Estimates) is also under investigation, the Wall Street Journal reported, citing sources familiar with the situation.

No. 2 long-distance provider WorldCom (WCOM: down $0.21 to $6.57, Research, Estimates) was under pressure after published reports said the company could cut up to 10 percent of its work force as a means of countering a slowdown and an SEC probe into its accounting practices.

There were also a number of tech warnings and some analyst downgrades.

Software makers i2 Technologies (ITWO: down $0.25 to $4.56, Research, Estimates), Commerce One (CMRC: down $0.15 to $1.33, Research, Estimates) and Interwoven (IWOV: down $0.35 to $5.22, Research, Estimates) all said late Tuesday that first-quarter revenue will miss expectations, due to tough market conditions.

Morgan Stanley downgraded chipmaker Micron Technology (MU: down $1.60 to $30.80, Research, Estimates) to "underweight" from "equal-weight" saying the stock is likely to be under pressure in the near term.

A.G. Edwards upgraded media company Viacom (VIA.B: down $0.50 to $47.45, Research, Estimates) to "strong buy" from "hold," saying the advertising market is looking a little better.