Stocks fell Tuesday a drop in health insurers' shares amid an investigation of the insurance industry and concerns over a resurgence in crude prices offset better-than-expected earnings news from tech bellwethers IBM and Texas Instruments.

The blue-chip Dow Jones industrial average (search) ended down 58.70 points, or 0.59 percent, at 9,897.62. The Standard & Poor's 500 Index (search) closed down 10.79 points, or 0.97 percent, at 1,103.23. The technology-laced Nasdaq Composite Index (search) finished down 13.62 points, or 0.70 percent, at 1,922.90.

The S&P 500 closed at its lowest level since Aug. 30. Tuesday also marked the anniversary of the 1987 crash, when the Dow tumbled 22.6 percent in one day, according to the Stock Trader's Almanac.

"It looked like the market would open up and stay strong, based on the fact that oil prices were moving lower and IBM and TI came out with good results," said Owen Fitzpatrick, head of U.S. Equity Group at Deutsche Bank Private Wealth Management.

"But that's been erased because of the potential widening probe on behalf of Spitzer — which has not been confirmed — and on top of that we are facing the situation where oil is potentially heading higher."

Health insurers, including Aetna Inc. (AET) and Cigna Corp. (CI), fell sharply on concerns Eliot Spitzer will include the group as part of an investigation into the insurance industry. The Hartford Courant newspaper reported Tuesday Cigna and Aetna have received additional subpoenas from Spitzer's office since the ones the two insurers disclosed in June.

American International Group Inc. (AIG), which fell nearly 14 percent last week after Spitzer leveled fraud charges against insurance broker Marsh & McLennan Cos. (MMC), ended Tuesday's session down 3.3 percent, or $1.98, at $57.70. Marsh & McLennan fell nearly 6 percent, or $1.47, to $24.10.

Capping the lid on stocks, persistent supply worries and an attack on a key Iraqi pipeline helped oil rebound after a steep decline Monday, and although prices stayed in negative range, they did make up some of their losses. Light, sweet crude for November delivery closed down 38 cents at $53.29 on the New York Mercantile Exchange (search). Other commodities were also under pressure, including steel and paper.

"Between Spitzer and oil prices, it's taking away from some of the party that we saw earlier with IBM and Texas Instruments, which has helped the Nasdaq hold it together today," said Steven Goldman, chief market strategist for Weeden & Co. in Greenwich, Conn.

IBM (IBM), a Dow component, rose more than 4 percent to .$89.37on better than expected third-quarter results. IBM reported a small gain in third-quarter profits and its earnings beat estimates by 3 cents a share.

Also buoying the tech sector, Texas Instruments (TXN) advanced 6.9 percent, or $1.46, to $22.55 on solid third-quarter profits due to rising demand for its products in high-end mobile phones and digital light processing systems for big-screen televisions. TI, which makes chips for more than half the world's mobile phones, reported per-share earnings of 32 cents, topping its own estimates and Wall Street's forecasts.

The Labor Department (search) reported a modest 0.2 percent rise in September for its Consumer Price Index (search) as lower prices for new cars and airfares helped temper a rise in energy and medical care costs. The reading of the government's most closely watched inflation barometer matched economists' expectations, following a 0.1 percent increase in August.

Still, the report raised new worries about whether inflation poses a risk to the economy as higher lodging costs drove core prices — which exclude volatile energy and food prices — up 0.3 percent, a greater increase than the 0.2 percent projected by economists.

"It looks like the price hikes on the commodity side are starting to bleed into consumer prices," said Jack Ablin, chief investment officer at Harris Private Bank. "I don't think you can sustain this constant bombardment of energy prices, and higher food prices too, and not have it bleed through to the consumer."

It was unclear whether the inflation reading will have any impact on the central bank's policy on rates. The Federal Reserve (search) has boosted short-term interest rates three times this year, and many analysts believe its Nov. 10 meeting will bring a fourth hike. But observers are divided on whether a fifth rate increase is in store for December; a precipitous rise in inflation could be a deterrent.

Separately, housing construction fell by 6 percent in September to a seasonally adjusted annual rate of 1.898 million units, the Commerce Department (search) said. The decline, steeper than expected, followed a 1.8 percent rise in housing activity in August, which turned out to be stronger than initially estimated.

After the closing bell, Motorola Inc. (MOT), the world's No. 2 maker of cell phones, tumbled 6 percent, or $1.22 to $17.50. Motorola said its quarterly profit rose sharply, helped by improving sales of a host of new handset models.

Motorola's revenues, however, missed Wall Street's average estimate.

Ford Motor Co. (F) fell about 2 percent to $13.08 after the carmaker, which reported a higher-than-expected quarterly profit earlier, said that the Securities and Exchange Commission has asked the company for information on its pension fund accounting.

General Motors Corp. (GM) also said that the SEC asked it last week to provide information on the accounting of its pension and post-retirement health care plans. The SEC said last week it is looking into possible accounting abuses involving companies' assumptions about employee pension funds.

McDonald's Corp. (MCD) rose 7 cents to $29.27. The company said quarterly net income rose 42 percent, helped by strong sales in the United States and a tax benefit.

Trading was heavy, with 1.7 billion shares changing hands on the New York Stock Exchange, above the 1.4 billion daily average for last year. About 1.7 billion shares were traded on Nasdaq, above the 1.69 billion daily average last year.

Decliners outnumbered advancers on the NYSE by about two to one, and three to two on Nasdaq.

The Russell 2000 index, which tracks smaller company stocks, was down 5.36, or 0.94 percent, at 566.67.

Overseas, Japan's Nikkei stock average added 0.91 percent. In Europe, France's CAC-40 rose 1.11 percent, Britain's FTSE 100 added 0.62 percent and Germany's DAX index surged 1.25 percent.

Reuters and the Associated Press contributed to this report.