The Dow Jones industrial average was down 24.56 points at 3,653.43 at 1 P.M. local time. In the broader market, declining issues beat out advances 2 to 1 on active trading of more than 270 million shares on the New York Stock Exchange.
On Tuesday, the blue-chip barometer plunged 91 points as concerns over steeper interest rates erupted into a broad selloff.
Those worries had been growing since last week's rate hike by the Federal Reserve.
Analysts said the market was worried that the Federal Reserve's latest rate increase of a steep three-quarters of a percentage point -- the biggest rate hike in 13 years -- could cripple the economy and weaken corporate earnings.
"There is a real risk that (Federal Reserve Chairman Alan) Greenspan & Co., however good their intentions may be, are running the risk of slowing the economy in 1995 far more than anyone expected," said David Bostian of Heine Herzog Geduld.
"The result is a diminished profit potential, especially for those companies which are economically sensitive," he said.
Although the market traditionally rallies at this time of year, no such rally seemed to be in sight at midday, analysts said.
"Traders had been tentatively taking small positions in anticipation of a rally today and Friday," said Hugh Johnson, chief investment officer at First Albany Corp.
"The bothersome thing is that the patient is not responding even though these are traditionally strong days on Wall Street," he said.
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