NEW YORK (AP) _ Stocks fell sharply Thursday _ the third steep decline in four sessions _ on fears of severe economic repercussions following last week's terrorist attacks.

Wall Street's losses widened as Federal Reserve Chairman Alan Greenspan acknowledged that the terrorist attacks produced a significant drop in economic activity.

The selling was expected after a turbulent session Wednesday, when the Dow Jones industrial average fell more than 400 points but recovered to a loss of 144.

In the first hour of trading Thursday, the Dow was down 206.06 at 8,553.07. With Thursday's early decline, the Dow has lost 1,042 points so far this week.