Stocks retreated into negative territory Monday as Wall Street, faced with a mixed bag of earnings reports, searched for direction.

Blue chip shares were weighed down by Minnesota Mining & Manufacturing Co., which fell after reporting lower earnings because of growing weakness in its overseas markets and a strong U.S. dollar.

``There's a lot of worry out there as more earnings start coming in that they're going to show a trend of a slow, weak business environment,'' said Peter Coolidge, senior equity trader at Brean Murray & Co., as investors gird for a rush of earnings reports this week.

The Dow Jones industrial average dropped 152.23 points to end the day at 10,424.42, while the technology-heavy Nasdaq Composite Index fell 40.81 points to end at 1,988.56.

The broader Standard & Poor's 500 Index tumbled 19.82 points to 1,191.03. 

About 2,300 U.S. earnings reports will buffet Wall Street this week in the most hectic week of the reporting period, according to research firm Thomson Financial/First Call.

3M fell $1.68 to $111.32 after the diversified industrial giant and Dow component said results were lower because of weakness in its overseas markets and the strong U.S. dollar.

Along with 3M, Hewlett-Packard dragged down the blue-chip Dow with a loss of 90 cents to $25.52. 

Among Monday's biggest losers were companies that warned of tough business ahead. Lexmark International, which beat second-quarter expectations but reduced its forecast for the third quarter, slid nearly 64 percent, down $9.14 at $49.51. Goodyear Tire, which met expectations but said production must be curtailed, fell $1.80 to $29.84.

Wall Street's losses were spread across most sectors, a sign that investors doubt that any business is capable of doing well in the slowing economy. 

Microsoft sank $2.09 to $67.09, General Electric tumbled $1.33 to $45.30 and Wal-Mart fell $1.25 to $53.03. All three are Dow components.

No. 1 U.S. steelmaker USX-U.S. Steel Group posted a loss versus a profit a year ago hurt by the dampening effect on steel prices and demand from the weak economy. Its stock fell 12 cents to $20.88. 

Consumer products maker Colgate-Palmolive Co. was also hit, falling $2.21 to $53.60, after its income rose 9.6 percent. The company said higher margins offset the effects of weak foreign currencies that led to flat sales. 

BellSouth Corp. , the No. 3 U.S. local telephone company, reported a 8.6 percent drop in profits but its stock rose 88 cents to $41.68. 

Only three Dow stocks moved higher. American Express, which met earnings forecasts, inched up 15 cents to $38.13, while McDonald's rose 25 cents to $27.77 and IBM advanced 15 cents to $105.85.

Cisco Systems Inc. bucked the downward trend with a 28-cent gain at $18.27. UBS Warburg raised its investment rating on the Web gear maker and boosted its 12-month target price to $24 from $20. The Wall Street house said Cisco is not ``scrambling'' to make the current July quarter in the last two weeks and there is a sense of calm at the company.

Toy maker Hasbro rose 48 cents at $15.48 after reporting a second-quarter loss that was 2 cents a share less than Wall Street was expecting.

Investors were tense ahead of Federal Reserve Chairman Alan Greenspan's testimony to the Senate Banking Committee on Tuesday and hoped for hints on the nation's economic outlook.

Declining issues outnumbered advancers slightly more than 3 to 2 on the New York Stock Exchange. Volume came to 970.87 million shares, down from the 1.15 billion shares traded on Friday. 

The Russell 2000 index, which tracks the performance of smaller company stocks, fell 5.23 to 482.70. 

Overseas markets were mixed Monday. Japan's Nikkei stock average finished down 2.5 percent. In Europe, Britain's FT-SE 100 inched up 0.3 percent, Germany's DAX index was up 0.5 percent, and France's CAC-40 advanced 0.6 percent.

-- Reuters and the Associated Press contributed to this report.