Jitters spread on Wall Street
Countrywide results fan investor fears about mortgage, housing sectors; DuPont, Amex results weigh on stocks.
NEW YORK (CNNMoney.com) -- Disappointing earnings from a handful of blue chip companies helped send stocks sharply lower Tuesday, while investors nervously eyed the mortgage market and housing sector after lender Countrywide delivered its own dismal results.
The Dow Jones industrial average (down 87.95 to 13,855.47, Charts) retreated about 0.7 percent with 2-1/2 hours remaining in the session, after climbing nearly 100 points in the previous session.
"There are two major things happening today. There's backlash from Texas Instruments' very minor revenue miss, although more important to investors is that they didn't lift revenue guidance for the current quarter," said Fred Dickson, chief market strategist with D.A. Davidson & Co.
"The other thing is heavy fallout over Countrywide's miss and lowered guidance and discussion of problem loans. This darkens the cloud over an already troubled housing market."
Texas Instruments (Charts, Fortune 500) reported disappointing results after the market close Monday, which dragged on tech stocks. The chipmaker said weak demand contributed to lower quarterly profit and sales, sending shares down nearly over 3 percent.
Shares of Countrywide (down $3.92 to $30.13, Charts, Fortune 500), the nation's largest mortgage lender, tumbled over 11 percent as the firm said that quarterly profit fell 33 percent and it said it would slash its full-year earnings outlook.
The company's CEO also warned that it was unlikely that the U.S. housing market would recover before 2009.
Credit card issuer American Express (down $2.06 to $62.60, Charts, Fortune 500) reported better than expected profits late Tuesday but disappointing revenue numbers, sending its shares over 3 percent lower on the New York Stock Exchange.
Among individual issues, 20 of the 30 Dow components were lower in afternoon trade.
In corporate news, Apple (down $3.26 to $140.44, Charts, Fortune 500) stock fell 2.6 percent after AT&T said in its quarterly earnings report that it activated far fewer iPhones during the first two days the device was available than analysts had anticipated.
Market breadth was negative. Decliners beat advancers 5 to 1 on the New York Stock Exchange on volume of 983 million shares. Losers beat winners on the Nasdaq more than 3 to 1 on volume of 1.34 billion shares.
Oil prices tumbled, with U.S. light crude down $1.36 to $73.53 a barrel on the New York Mercantile Exchange.
Treasury prices rose in afternoon trade, lowering the yield on the 10-year note to 4.94 percent from 4.95 percent late Monday.
The dollar fell against the euro and the yen.