NEW YORK - Wall Street ended a whipsaw day mostly lower, as fears of increasing instability in the financial sector kept investors on edge despite a steep retreat in oil. The Dow Jones industrials on Tuesday had their first close below 11,000 since July 2006.

Just days after the government said it would aid Fannie Mae and Freddie Mac if necessary, Federal Reserve Chairman Ben Bernanke told Congress that the U.S. economy faces "numerous difficulties."

Shares of Fannie and Freddie -- which together hold or back nearly half of all the nation's mortgages -- tumbled again.

The stock market did benefit from some bargain-hunting as oil retreated from its near-record levels, but the uncertainty of the financial sector made that recovery hard to sustain.

A barrel of light, sweet crude dropped $6.44 to settle at $138.74 on the New York Mercantile Exchange as traders bet that the weak economy will take its toll on demand.

The Dow fell 92.65, or 0.84 percent, to 10,962.54. It was the blue chips' lowest close since July 21, 2006.

The Standard & Poor's 500 index fell 13.39, or 1.09 percent, to 1,214.91, while the Nasdaq composite index rose 2.84, or 0.13 percent, to 2,215.71.