Wall Street resumed its downward skid Tuesday, falling sharply as renewed concerns about soured home loans blew away what had looked like a solid recovery rally. The Dow Jones industrials lost nearly 150 points, while investors seeking safety moved into bonds.
Early in the session, stocks soared following strong earnings from General Motors Corp. and Sun Microsystems Inc. and amid somewhat mixed economic data. But the market pulled back after American Home Mortgage Investment Corp. said Tuesday it hasn't been able to tap into its credit lines and has hired advisers to consider its options, including the sale of its assets.
Wall Street has been concerned about lenders after some loans made to borrowers with poor credit have gone bad. Tuesday's trading showed how vulnerable the market remains.
The Dow fell 146.32, or 1.10 percent, to 13,211.99 after being up as much as 140 points during the session. The move lower undid a nearly 93-point gain the blue chips saw Monday in a partial rebound from the 585 points they lost over the course of Thursday and Friday.
Also, oil prices closed above $78 a barrel for the first time Tuesday on the New York Mercantile Exchange, advancing $1.38 to $78.21.