Wall Street takes a knock

Investors dumped stocks and sought safe-haven assets like the dollar and Treasurys on signs that the global economy is still struggling.

The Dow Jones industrial average lost 104 points Tuesday but recovered some of its earlier losses.

A disappointing earnings forecast from Dow Jones industrials component 3M Co. and a weak sales report from McDonald's Corp., another Dow company, pulled stocks lower. The reports overshadowed an increased profit forecast from FedEx Corp.

Reports in Britain and Germany signalled that manufacturing remains weak, while Japan's government approved $81 billion in stimulus measures to keep its economy out of recession. Credit rating agencies warned about debt problems in Dubai and Greece.

Investors sent the dollar and Treasury prices higher in response to the day's news. Commodities fell as the dollar rose. A stronger dollar makes commodities more expensive for buyers overseas, and hurts profits at companies that have large international operations.

After the huge rally in stocks and commodities this year, investors are looking for clues about where the economy is headed and how best to position their portfolios for next year.

According to preliminary calculations, the Dow fell 104.14, or 1 percent, to 10,285.97. The broader Standard & Poor's 500 index fell 11.31, or 1 percent, to 1,091.94, while the Nasdaq composite index fell 16.62, or 0.8 percent, to 2,172.99.