U.S. Stocks Fall for First Time in Three Days

American stocks fell for the first time in three days after fresh evidence of the deepening housing slump raised some corporate borrowing costs to a seven-year high and lowered earnings forecasts for financial companies.

Lehman Brothers Holdings Inc. and Morgan Stanley pushed financial shares to their biggest drop in six days on concern their profits will decline because of losses tied to subprime mortgages. Every homebuilder in Standard & Poor's indexes retreated. Apple Inc. slipped the most in a month after the iPod maker cut prices on mobile phones.

The S&P 500 Index lost 17.13, or 1.2%, to 1,472.29. The Dow Jones Industrial Average decreased 143.39, or 1.1%, to 13,305.47. The Nasdaq Composite Index fell 24.29, or 0.9%, to 2,605.95. Stocks erased Tuesday's gains, which followed the first monthly advance since May.

"There's a whole litany of negative news today," the senior vice president at Janney Montgomery Scott LLC in Philadelphia, Robert Morgan, said. "Bodies keep washing ashore that are related to subprime. I think that really helps facilitate dragging the market down."