Stocks of brokerages, both full-service and on-line, suffered badly Tuesday.

Some of the biggest stars lost more than 10% of their value during the day. Charles Schwab & Co., fell 11.1%, to $37.75; DLJdirect, a tracking stock of Donaldson, Lufkin & Jenrette Inc. 11.9%, to $18.625; E-Trade Group Inc. 14.9%, to $24.6875; and Ameritrade Holding Corp. 11.5%, to $21.25.

Full-service brokerages had steep losses. DLJ dropped 6.9%, to $48.625, while Merrill Lynch & Co. declined 2%, to $67.25. Bank stocks also declined. The Standard & Poor's bank stock index was down 2.3%, to 651.42, and the Nasdaq index of bank stocks 0.4%, to 1,810.

The Standard & Poor's 500 dropped 0.4%, to 1,322.18, and the Nasdaq 1.4%, to 2,587.9. The Dow Jones industrial average fell 0.3%, to 10,677.31.

Stocks related to on-line brokerages were hit by a double whammy.

Investors have been jettisoning Internet stocks because of the sector's slowness to produce earnings and the stratospheric price-to-earnings ratios for the few that do generate profits.

Investors "are taking more of a 'show-me' attitude," said Charles Johnson, head equity trader at Blaylock & Partners in New York. The Internet stocks are continuing "to be hurt by these high valuations. People are staying away from those stocks in droves."

Ameritrade closed at $21.25, down 11.5%. DLJdirect dropped below its initial public offering price, closing at $18.625, down 11.9%. In May it opened at $20 and peaked on May 27 at $45.625.

Financial Internet stocks were hurt across the board. Telebanc Financial Corp. fell 15.2%, to $23.4375. NextCard Inc. dropped 11.8%, to $32.35. E- Loan dropped 19%, to $28.5625.

Sean Ryan, a bank analyst at Bear, Stearns & Co., said, "On-line brokers are the 800-pound gorillas of financial dot-coms. As they go, it puts pressure on the nonbroker e-financials."

Observers say much of the on-line brokerages' business-commissions from day-traders-are suffering from falling stock prices and summer slugishness. With the markets trending downward in light volume, many day-traders have trouble clearing their transaction costs and are becoming discouraged, observers say.

Day-traders "have a little bit less enthusiasm," said John Hannon, an analyst for Security Capital Trading in New York. "All of a sudden they are discovering that this is not a one-way street."

Weekly volume in the 30 stocks on the Dow Jones index declined to 356 million shares, or 37%, last week, from a frenzied peak of 568 million the week ending April 23. And all indexes are off from earlier highs this year.

But the hits the brokerages are taking as a result of any day-trading falloff may be a blessing for full-service brokers. "The market is teaching day-traders this is not what they should be doing," Mr. Johnson said. "This is exactly what the traditional full-line borkerage firms needed to preserve their franchise."

There were exceptions, however. Shares of Rock Financial Corp. soared 17.11%, to $21.8125, on takeover rumors, on a day when most mortgage stocks were off.

The Farmington Hills, Mich., mortgage lender is building an Internet origination platform, which, some apparently believe, make it an attractive target for others that want to make loans on-line.

But some analysts were skeptical about the rumors. Presumably, any buyer would have to pay a premium over the company's market capitalization of $322.5 million at the end of trading yesterday.

"Why pay $400 million when you can pay $4 million to replicate it by hiring three guys?" said Michael McMahon, an analyst at Sandler O'Neill & Partners. Rock executives could not be immediately reached for comment.

Meanwhile, even the full-service brokerages must contend with a general malaise creeping over financial stocks. They are hurt by rising yields on long-term Treasury bonds and fears of another rate hike by the Federal Reserve. A series of economic reports last week rekindled fears of inflation and expectations of higher rates.

Financial stocks "have had a good run," Mr. Johnson said. "There are nice profits that people have locked in and there is feeling out there to take some chips off the table."

Yields on 30-year Treasury bonds crept up 4 basis points to 6.15 on Tuesday.

Trading on "gut reactions," bearish investors first abandon the brokerages, said Adam J. Lewis, senior vice president at Keefe, Bruyette & Woods Inc. Those investors have the perception "the bread-and-butter brokerage business is going to slow."

Among the stocks of major banks on Tuesday, Citigroup Inc. was unchanged at $44.125, and Bank of America Corp. fell 1.4%, to $64.625.

Meanwhile, State Street Corp. fell 1.5%, to $68.625, while First Tennessee National Corp. dropped 3.7%, to $34.50.

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