NEW YORK (CNNMoney.com) -- The Nasdaq composite slumped Monday, as investors bailed out of tech stocks after a stellar third quarter, while the Dow Jones industrial average lost its nerve, abandoning the third attempt to knock out its all-time record.

The Nasdaq composite (down 20.83 to 2,237.60, Charts) fell 0.9 percent.

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The Dow industrials (down 8.72 to 11,670.35, Charts) ended just below unchanged after briefly topping its all-time closing high in the early afternoon. The blue-chip barometer had edged above its all-time closing high of 11,722.98 twice last week, but failed to close above that level. It closed at that point on Jan. 14, 2000.

The Dow's all-time intraday high is 11,750.28, also from Jan. 14, 2000.

The S&P 500 (down 4.53 to 1,331.32, Charts) index lost about 0.3 percent. Last week, the broad index topped out a 5-1/2 year high Thursday, before scaling back a bit Friday.

Treasury prices rose, lowering the corresponding yields. Oil prices slumped nearly 3 percent.

After opening flat, blue chips rose through the early afternoon in response to falling oil prices and the morning's economic news.

But the Nasdaq composite - which hadn't joined the morning run - turned lower in the afternoon and weighed on the other major gauges.

Rather than being caused by a news event, the stock decline was likely a result of electronic sell programs kicking in as the market again tried to push through the records, said Art Hogan, chief market analyst at Jefferies & Co.

The Dow's high represents a psychological threshold that may be hard to get past for a while, he said. But the market's inability to stick above that level is not that significant.

"We just had the best third quarter in years," he said, adding that the issue now is will the market be able to see a strong fourth quarter as well.

James Awad, chairman at Awad Asset Management, said he thinks the market should be able to move up through October, before retreating a bit in the lead up to the mid-term elections in November.

"You have reasonable economic growth, low inflation, the Federal Reserve is done raising rates, and the third-quarter earnings should be positive," Awad said. "October should be pretty upbeat."

Last week, the major gauges finished out the best third quarter since 1997. The S&P 500 rose just short of 5 percent in the third quarter, while the Dow gained 4.5 percent. The Nasdaq gained 3.8 percent.

Marvel Technology was among the stocks likely to be active Tuesday.

After the close Monday, the chipmaker said it would need to restate financial results going back to its initial public offering in 2000, due to misdated stock options. Marvell also warned that third-quarter sales will be down 10 percent from the previous quarter, due to weaker demand from disk-drive makers.

Marvell (Charts) shares slumped 16 percent in extended-hours trade.

No market-moving companies are due to report results Tuesday. September auto and truck sales are due around midday.

As of 5:45 p.m. ET, Nasdaq and S&P futures pointed to a modest decline Tuesday morning, when fair value is taken into account.

Meanwhile, the morning's economic news mostly supported hopes that the economy is slowing enough to take the edge off inflation, but not so much as to head toward recession.

The Institute for Supply Management's manufacturing index for September fell to 52.9 in the month from 54.5 in August. Economists surveyed by Briefing.com thought it would fall to 54.

While the report missed estimates, it also remained above the 50 level, meaning that it showed expansion in the sector. The report would seem to support stocks, in that it adds to bets that the Federal Reserve can start cutting interest rates early next year.

A separate report showed construction spending rose 0.3 percent in August after falling 1 percent in the previous month. Economists surveyed by Briefing.com thought it would fall 0.3 percent.

Treasury prices rose after the reports, with the yield on the 10-year note slipping to 4.61 percent from 4.63 percent late Friday. Treasury prices and yields move in opposite directions.

Among tech decliners, a variety of software stocks slipped, lowering the Goldman Sachs Software (Charts) index by 1.4 percent.

Apple Computer (down $2.12 to $74.86, Charts) fell 2.75 percent after Citigroup downgraded the stock to "hold" from "buy."

Healthcare and telecom stocks, two of the best performers in the last quarter, declined as well.

Qualcomm (down $1.69 to $34.66, Charts) slipped ahead of a patent-dispute hearing. It was among the telecoms dragging down the Nasdaq Telecommunications index (down 2.61 to 204.24, Charts).

In corporate news, Gilead Sciences said it will buy Myogen for $2.5 billion. Gilead (down $4.49 to $64.28, Charts) shares slipped 6.5 percent, while Myogen (up $16.36 to $51.44, Charts) shares climbed nearly 47 percent.

Harrah's Entertainment (up $9.25 to $75.68, Charts) jumped 14 percent on news that the company is considering selling itself to private buyout firms Apollo Management and Texas Pacific Group for $15 billion in cash.

The possibility of a deal was first mentioned in a Wall Street Journal report Monday morning.

Wal-Mart Stores (down $0.88 to $48.44, Charts) lost 1.8 percent after the retailer said that sales at stores open a year or more, also known as same-store sales, rose 1.8 percent in September, at the low end of its previous range.

Market breadth was negative. On the New York Stock Exchange, losers beat winners by 6 to 5 on volume of 1.37 billion shares. On the Nasdaq, decliners topped advancers by 2 to 1 on volume of 1.81 billion shares.

U.S. light crude oil for November delivery fell $1.88 to settle at $61.03 a barrel on the New York Mercantile Exchange.

COMEX gold for December delivery fell $1 to settle at $603.20 an ounce.

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