NEW YORK (CNN/Money) - Stocks sank Wednesday as the now familiar pattern of up one day and down the next pulled the Dow industrials to a triple-digit loss after Tuesday's powerful rally.

The broader market sank for the third of the last four sessions as selling accelerated in the final half-hour of trading.

Some of the biggest losses came around 3:40 p.m. when brokerage Bear Stearns entered an erroneous order to sell $4 billion worth of securities instead of $4 million, the New York Stock Exchange said. Bear Stearns was able to cancel all but $622 million of that sell order prior to it being executed, the NYSE said.

Bear Stearns spokeswoman Elizabeth Ventura declined to provide details about how the error occurred, what was sold and who was responsible. She did say the mistake will have no material impact on the brokerage's financial results.

The Dow Jones industrial average (down 183.18 to 7755.61, Charts) sank 2.3 percent, the Nasdaq composite (down 26.42 to 1187.30, Charts) fell 2.2 percent and the Standard & Poor's 500 index (down 20.00 to 827.91, Charts) was off 2.4 percent. Wednesday's declines followed Tuesday's rally that propelled the Dow to its third-highest percentage gain for the year.

"People aren't going to chase those types of rallies anymore. Investors have been burnt too often and we're going to have a choppy market going forward," said David Briggs, head of global equity trading with Federated Investors told CNNfn's Street Sweep. "A lot of people are not sure what to do and that uncertainty is playing itself out in the marketplace."

Stocks had earlier struggled for direction as investors shied away from committing money amid renewed concerns about a profit recovery.

Wednesday's trading session ended with losses; the Dow declined 183 points and the Nasdaq lost 26 points. Play video (QuickTime, Real or Windows Media)

"When a rally gets under way the sellers pull away and when selling sets in the buyers pull away. We'll have to get used to this type of volatility. The market is trying to find a bottom and could take six months to do that. But people are trying to trade this market in excess of its underlying fundamentals," Briggs added.

Among technology issues, software, networking and select chip stocks took a hit after analysts downgraded their estimates. An upbeat outlook from Dell also failed to inspire the market. A warning from chemical maker Dow Chemical set the early negative tone for the broader market.

"I think it's a good thing we haven't seen a retracement of all of [Tuesday's] gains," said Art Hogan, chief market analyst with Jeffries & Co. "I think the market will continue to drift without any real direction until we get Friday's employment report and investors get a sense of the current economic outlook."

Friday's September jobs report is expected to show unemployment ticked back up to 5.9 percent last month from 5.7 percent in August, according to economists surveyed by Briefing.com.

In the meantime, Thursday investors get the weekly claims for jobless benefits and the Institute for Supply Management's update on the services sector.

Good news from one tech bellwether provided some resistance to the overall negative sentiment. Dell Computer (DELL: up $0.68 to $25.32, Research, Estimates), the No. 2 supplier of personal computers, said late Tuesday that revenue for the quarter ending this month will be slightly above previous forecasts, with earnings coming in at the high end of the projected range.

Dell, which made the announcement at its ongoing analysts' meeting in Austin, Texas, attributed its improved guidance to a gain in market share rather than to an industry recovery. Lehman Brothers upped its 2002 and 2003 estimates on the stock, while Credit Suisse First Boston raised its 2002 revenue and profit estimates.

Causing some discomfort for the Nasdaq was Merrill Lynch's bearish call on chipmakers and an estimate downgrade for Cisco Systems (CSCO: down $0.89 to $10.05, Research, Estimates).

Merrill cut its 2002 and 2003 capital spending growth forecast and slashed estimates on a host of chipmakers, saying it believes semiconductor companies will be less profitable given the current industry environment.

Meanwhile, Deutsche Bank Securities cut its 2002 and 2003 estimates on a number of enterprise software companies, including Siebel Systems (SEBL: up $0.11 to $6.10, Research, Estimates) and PeopleSoft, (PSFT: down $0.08 to $12.39, Research, Estimates) citing expectations for disappointing results and reduced guidance going forward.

Compounding the tech concern, UBS Warburg cut its revenue and price target for Cisco Systems, the No. 1 network equipment maker, citing weakness in information technology spending.

In addition, some worrisome words came from software maker Oracle (ORCL: down $0.23 to $8.31, Research, Estimates)'s CEO Larry Ellison. According to news reports, Ellison said in a media briefing in New Zealand that he sees slow growth both in the tech sector and the U.S. economy.

Among the market movers, Dow Chemical (DOW: down $2.55 to $27.25, Research, Estimates), the nation's largest chemical company warned of flat earnings in the third quarter compared with expectations of an improvement in the bottom line. The warning dragged on sector mate DuPont (DD: down $2.32 to $37.31, Research, Estimates), a Dow component.

Investor anxiety over fourth-quarter earnings projections is well-founded, according to earnings tracker First Call. As the pre-announcement period intensifies, the earnings growth forecast for the quarter could be revised lower to 15 percent from the current 20.6 percent as analysts continue to slash their estimates.

"Analysts gave a pie-in-the-sky aspect of a profit recovery in the third and fourth quarters. Since the year began, that hasn't exactly happened," Chuck Hill, First Call's director or research, told CNNfn's The Money Gang. "Any deviation from that 15 percent for the quarter is expected to be lower, not higher," Hill added.

Johnson & Johnson (JNJ: up $2.00 to $58.30, Research, Estimates) was the biggest gainer on the Dow. The maker of healthcare products was boosted by news that a federal judge blocked rival Guidant (GDT: down $5.10 to $27.73, Research, Estimates)'s development of a drug-coated stent used to help once-clogged arteries from re-clogging.

Continued concerns about a potential war with Iraq also hung over the market. Reports that Iraq and U.N. officials had reached agreement on weapons inspections ignited a rally Tuesday that catapulted the Dow Jones industrial average 4.6 percent to its third-biggest gain for the year.

But Wednesday, congressional leaders emerged from a breakfast meeting with President Bush saying that Congress is likely to pass a resolution that gives the president the authority to use military force against Iraq.

European markets closed higher. Tokyo's Nikkei index finished at a 19-year low, although most of the other Asian-Pacific markets finished higher.

Treasury prices rose, with the 10-year note yield at 3.71 percent. The dollar was higher against the yen but slipped against the euro.

Light crude oil futures dropped 36 cents to $30.47 a barrel in U.S. trading. Gold was higher. Oil price took a hit as traders await the impact of Hurricane Lili on oil and gas operations in the Gulf of Mexico.

More stocks fell than rose. On the New York Stock Exchange, decliners topped advancers 2-to-1 as 1.6 billion shares traded. On the Nasdaq, winners beat losers by nearly 2-to-1 as 1.7 billion shares changed hands.