US stocks fell sharply yesterday after the Federal Reserve's Beige Book report on the economy showed no signs of light, dumping bad news on a listless midsummer market with no driving themes.

The Dow Jones Industrial Average fell 165.24 points, or 1.58 per cent, to 10,293.50. This marked the Dow's lowest close since July 24th. The technology-heavy Nasdaq composite index dropped 61.43 points, or 3.03 per cent, to 1,966.36, also the Nasdaq's lowest close since July 24th. The diversified Standard & Poor's 500 index gave up 20.87 points, or 1.73 per cent, to 1,183.53. Year to date, the Dow is down 4.6 per cent, the Nasdaq is off 20.4 per cent and the S&P 500 has fallen 10.4 percent.

"There was hope that Cisco would bring some clarity going into today ... but really we were left with more of a muddle than we had to begin with," said Mr Jeffrey Kleintop, chief investment advisor at PNC Advisors.

Stocks fell at the open on more profit worries brought about by Cisco Systems Inc's quarterly earnings report and outlook, released late Tuesday after the closing bell.