The Dow Falls 81 Points, Nasdaq Drops 7

The Dow fell 80.86 points to close at 13,595.46, the Nasdaq dropped 7.06 points to close at 2,611.23, and the S&P 500 lost 8.23 points to close at 1,530.95. Stocks sold off after Fed Chairman Bernanke made hints that the economy is sitting well-off-enough that interest rate cuts may not be needed. Several analysts predict a 3-5% pull-back before ending the year higher than current levels.

Oil fell $0.60 a barrel to close at $65.61.

Volume was modest with 2.98 billion shares trading on the NYSE and 2.25 billion trading on the Nasdaq. Decliners topped Advancers by a margin of 24:8 on the NYSE and 19:11 on the Nasdaq.

In individual stories, Senomyx, Inc. (Nasdaq: SNMX) gained 16.3% after the Company announced that Nestle SA has begun the initial commercial introduction of the first food products that contain Senomyx's savory flavor ingredients. Under the terms of its agreement with Nestle, Senomyx will receive royalty payments based on sales of products containing its flavor ingredients. Telik Inc. (Nasdaq: TELK) fell 25% after the FDA has placed a clinical hold on the Investigational New Drug application for TELCYTA. The clinical hold was initiated by FDA following the presentation of TELCYTA Phase 3 clinical trial results at the annual meeting of the American Society of Clinical Oncology.

Investors will also be looking for economic data on MBA Mortgage Applications, US Non-farm Productivity, and Oil Inventories.

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