NEW YORK — Stock prices shot up 24 percent from late November to January, fell 7 percent in the first week of the new year — and then stood still. Welcome to the bear market.

Yesterday, worries about banks sent the Dow Jones Industrial Average down 25.41, or 0.30 percent, to 8,448.56.

Broader indexes advanced. The Standard & Poor’s 500 index rose 1.53, or 0.18 percent, to 871.79, while the Nasdaq composite index rose 7.67, or 0.50 percent, to 1,546.46. The Russell 2000 index of smaller companies rose 4.99, or 1.06 percent, to 473.79.

Stocks of Rhode Island importance fell, led by General Dynamics Corp. and Raytheon Co. The Bloomberg Rhode Island Index, a price-weighted list of companies with operations in the region, fell 0.73 to 160.28. General Dynamics fell $2.58 to $55.10. Raytheon fell $1.25 to $49.29.

Wall Street has lost some of the enthusiasm that powered its late 2008 rally. The Dow industrials have taken the biggest hit, falling for five straight days as investors questioned whether they got ahead of themselves when they bet last month that the economy and corporate profits were about to recover.

“The wind has sort of been taken out of the sails,” said Carl Beck, partner at Harris Financial Group. “The optimism that we saw at the beginning of the year has sort of been put on hold as people await earnings reports over the next couple of weeks.”

With companies issuing warnings about their revenue and profit over the past week, the safe play on Wall Street has become to throw out analysts’ already lowered expectations and predict that results will fall well short.

Alcoa Inc. started the reality check. The aluminum producer warned last week that results would be bad and that it was slashing production. Then, late Monday, the company said it lost $1.19 billion during the fourth quarter as demand for aluminum plunged. The stock slumped 5.1 percent yesterday.

Investors saw Alcoa’s numbers as a troubling sign of the severity of the recession. Alcoa’s report marks the unofficial start to the three-week rush when most companies report their results from the October-December quarter.

“Alcoa is a harbinger of things to come,” said Jeff Buetow, senior portfolio manager at Portfolio Management Consultants. “It was a horrible report.”

Investors are worried that the economy is punishing even conglomerates such as General Electric Co., which has an array of businesses to offset weakness in one area. An analyst warned yesterday that GE could disappoint investors when it releases results next week.

Market veterans said they aren’t surprised by the return of volatility and heavy selling to the Street after the relative tranquility of December. When the market hit its lows on Nov. 20, analysts uniformly warned that the recovery would be uneven, rocky and unpredictable — the hallmark of a bear market.

The Standard & Poor’s 500 index has given up 3.5 percent this year as investors shift into wait-and-see mode over the health of companies’ results. Questions about earnings — in particular companies’ expectations for business this year — are likely to dominate trading in the coming weeks. Computer chip maker Intel Corp. and drug company Genentech Inc. are scheduled to report results this week.

The market will get an earlier-than-expected reading on the financial sector when JPMorgan Chase & Co. reports earnings tomorrow — nearly a week ahead of schedule. Investors are fearful of seeing another year of multibillion-dollar losses from financial companies, as analysts forecast mounting problems in credit card and commercial real estate portfolios.

“Since financials led the market lower last year, the fear is that financials are going to have a crummy quarter,” said David Katz, chief investment officer of Matrix Asset Advisors. “That is going to be bad for the market.”

Bank of America Corp. tumbled yesterday after a Sandler O’Neill & Partners analyst became the latest to revise his expectations for the company’s fourth-quarter results and predict a loss. The stock fell 6.8 percent.

Meanwhile, Citigroup Inc. and Morgan Stanley announced a deal after the closing bell to combine their brokerage operations as Citi struggles to raise additional cash.

The Russell 2000 index of smaller companies rose 4.99, or 1.06 percent, to 473.79.

Losing stocks outnumbered gainers by about 8 to 7 on the New York Stock Exchange, where volume came to 1.31 billion shares.

Bond prices were mixed. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 2.30 percent from 2.31 percent late Monday. The yield on the three-month T-bill, considered one of the safest investments, rose to 0.12 percent from 0.06 percent late Monday.

The dollar was mixed against other major currencies, while gold prices advanced.

Light, sweet crude oil rose 19 cents to settle at $37.78 on the New York Mercantile Exchange after tumbling 8 percent Monday.

After rising on the first trading day of the New Year, stocks last week had their worst weekly performance since November as profit warnings from Wal-Mart Stores Inc., Intel, Alcoa and media company Time Warner Inc. set off investors’ fears about companies’ suffering under the economy.

“You’ve got the lingering shroud of doubt in people’s minds, ‘Is it going to be worse than already lowered expectations?’ ” Beck said.

Some economists say investors have been too quick to predict that the economy will hit bottom sometime this year and begin to show signs of recovery.

“This recession is nothing like a lot of people have seen,” said Robert B. MacIntosh, chief economist at Eaton Vance Corp.

The market got some upbeat news that lent support to stocks early in the day before sellers reentered the market. The Commerce Department said the trade deficit fell to its lowest level in five years. The deficit narrowed 28.7 percent to $40.4 billion in November from $56.7 billion in October as demand for oil dropped by a record amount.

Though demand for imports has dropped, investors are more concerned by the waning need for American products overseas as economies around the world suffer. The fear is that as companies struggle with falling global demand, it will be more difficult for the economy to rebound.

Asian markets tumbled, hurt by reports that Sony Corp. is sinking into its first yearly operating loss in 14 years on declining sales for digital cameras, flat-panel TVs and other gadgets. Japan’s Nikkei stock average fell 4.79 percent. Hong Kong’s Hang Seng index dropped 2.17 percent.

Britain’s FTSE 100 fell 0.61 percent, Germany’s DAX index fell 1.75 percent, and France’s CAC-40 declined 1.49 percent.