Apple - Can't get rid of incomplete download bar underneath dock icon
you don't need to remove/delete the Downloads folder from the dock and re add it, just move it in a new position and the re position it to the old one
I removed the folder from the dock and dropped it back on there and it was gone :)
None of the other solutions would solve this for me. The odd part about my issue (that others may or may not have experienced) is that the bar had appeared under the downloads folder yet if I opened different apps the bar would remain in place instead of staying centered under the downloads folder.
What solved it for me was running killall Dock
in Terminal.