NEW YORK " Stocks extended their steep decline and bond prices jumped Tuesday, a day after Wall Street's worst session in years, as nervous investors grappled with concerns about insurer American International Group Inc. and awaited the Federal Reserve's decision on interest rates.
Worries about the well-being of AIG have intensified after the several ratings agencies reduced their ratings on the company. Lower ratings can add to the amount of money the already cash-strapped company has to set aside. Investors are fearful that a failure by the world's largest insurance company would touch off a wave of financial turmoil. AIG fell $3.09, or 65 percent, to $1.67 in early trading.
Comments from Goldman Sachs Group Inc. about the banking sector added to investors' glum mood.