Stocks fell in New York yesterday as renewed interest rate jitters and troubling developments in Asia negated some early excitement over a potential merger between Chrysler and Germany's Daimler-Benz.

The Dow Jones industrial average dropped 92.92 points to 9,054.65. An early 32-point gain had put the blue-chip measure within 13 points of Monday's record close of 9,192.66.

Broad-market indicators also surrendered early gains as investors remained cautious in advance of Friday's report on pay levels.

There was little reaction to a Federal Reserve report saying economic growth continued at a "moderate to strong" pace in March and April.

The report, which will serve as the basis for the Fed's May 19th meeting on interest rate strategy, also offered hints that the economic drag from Asia and competitive pressures at home may be keeping inflationary pressures in check.