Stocks tumbled Thursday as new signs of weak business activity and a mediocre outlook for corporate profits continued to weigh on the market .

Trading was erratic as the market cut its losses in half shortly after the U.S. Justice Department said it will not seek to break up software giant Microsoft Corp. — but stocks fell again.

The Dow Jones industrial average ended the day down 192.43, or 1.9 percent, at 9,840.84. The last time the Dow closed lower was April 6 when it stood at 9,791.09.

The broader market also posted big losses. The Nasdaq composite index fell 53.37, or 3.0 percent, to 1,705.64. The Standard & Poor's 500 index declined 25.34 to 1,106.40, just shy of piercing its low for the year - 1103.25 hit on April 4.

The Nasdaq has fallen in seven of the last eight trading sessions. All of the major indexes are on course to breach the April lows, and test lows notched in the autumn of 1998.

"The unwinding continues - unabated," said Scott Bleier, chief investment strategist at Prime Charter Ltd.

The market will be paying close attention to Friday's August employment report for clues about the state of the wheezing economy.

Year-to-date, the Dow is down 8.8 percent, Nasdaq off 31 percent, and the S&P 500 off 16.2 percent.

Wall Street's losers included Microsoft, which fell $1.72 to $56.02.

Intel declined $1.37 to $26.10 as investors were doubtful the chip maker's business will soon improve. Merrill Lynch analyst Joseph Osha also lowered his third-quarter revenue estimate on Intel.

However, in a statement released after the close of regular trading, Intel said it expects revenue for the third quarter to be within the range of previous expectations.

Motorola tumbled $2.46, or 15 percent, to $13.94 after saying it expects third-quarter sales to be flat versus the second quarter, rather than up 5 percent it had anticipated earlier. The cell phone maker also announced it's slashing 2,000 jobs, bringing this year's total job cuts to 32,000.

Technology aside, stock prices dropped across an array of sectors, which analysts attributed to investors' growing unease in a market that's still awaiting an economic turnaround.

"Nobody is willing to step up and be bold, because frankly there is no reason," said Charles White, portfolio manager for Avatar Associates.

While investors know that a turnaround will occur, they are grappling with the fact that it could take quite a while for the robust economic growth enjoyed during the bull market to return to Wall Street.

"What that means is you won't get a good profits rebound," said Charles Pradilla, chief investment strategist at SG Cowen Securities.

Investors once again punished companies that evidenced dismal prospects for future sales and earnings.

Schering-Plough dropped $2.11 to $37.74 after UBS Warburg reduced its rating on the pharmaceutical maker's shares, citing excess inventory.

Gap plunged $4, or 21 percent, to $15 after warning that third-quarter sales will be lower than expected. CIBC World Markets also lowered its rating on Gap to "hold'' from "strong buy."

Wal-Mart fell $1.78 to $47.37 despite reporting sales at stores open for at least one year, called same-store sales, rose 7 percent in August.

Investors were also discouraged by yet another report confirming that the economy remains weak. The National Association of Purchasing Management's Non-Manufacturing Business Activity Index registered 45.5 percent in August, 3.4 percentage points lower than in July and a new low for the index. A level below 50 indicates that business is contracting.

"On a day when there is other bad news out there, it is just one more straw, one more log on the pile," said White, the Avatar portfolio manager.

There were some winners on Wall Street, including electronics retailer Best Buy, which rose $1.57 to $60.29 after reporting a 2.8 percent rise in second-quarter same-store sales. Merrill Lynch also raised its 2002 and 2003 earnings targets for Best Buy.

Declining issues outnumbered advancers more than 2 to 1 on the New York Stock Exchange. Volume came to 1.3 billion shares, down from 1.4 billion shares that were traded at the same point Wednesday.

The Russell 2000 index, which tracks smaller companies stocks, fell 9.12 to 453.39.

Overseas markets were mixed Thursday. Japan's Nikkei stock average closed with a gain of 0.5 percent. European indexes all hit two-year lows, as France's CAC-40 lost nearly 2.0 percent, Britain's FT-SE 100 fell 2.1 percent and Germany's DAX index tumbled 3.4 percent.

Reuters and the Associated Press contributed to this report.