Two of the dead were recovered by a civilian boat, while the third was found by a Coast Guard helicopter.
Dunphy said conditions were fine for sailing, with good visibility and moderate ocean swells of 6-to-8 feet.
A total of 210 boats were registered in the 65th annual yacht race, according to the Newport Ocean Sailing Association's website. The race started off from Newport Beach on Friday and many boats finished in Ensenada Saturday.
About 50 people gathered in morning fog Sunday at the Ensenada marina to watch the final arrivals. A notice tacked to a bulletin board alongside the racing times informed spectators of the tragedy.
The association's commodore told the AP that he didn't know the members of the Aegean or how many people were aboard.
"This has never happened in the entire 65 years of the race that I'm aware of," Chuck Iverson said. "We're all shocked by this whole event."
The deaths come two weeks after five sailors died in the waters off Northern California when their 38-foot yacht was hit by powerful waves, smashed into rocks and capsized during a race. Three sailors survived the wreck and the body of another was quickly recovered. Four remained missing until one body was recovered last Thursday.
The deadly accident near the Farallon Islands, about 27 miles west of San Francisco, prompted the Coast Guard to temporarily stop races in ocean waters outside San Francisco Bay. The Coast Guard said the suspension will allow it and the offshore racing community to study the accident and race procedures to determine whether changes are needed to improve safety. U.S. Sailing, the governing body of yacht racing, is leading the safety review, which is expected to be completed within the next month.
AP reporters Bernie Wilson in San Diego and Daisy Nguyen in Los Angeles contributed.
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