WALL STREET: Opens with sharp drop

    NEW YORK  _ Wall Street fell sharply early Friday as
investors digested wider-than-expected losses at insurer American
International Group Inc. and another worrisome spike in oil prices.
    AIG's loss for the first quarter rekindled investors' anxiety
about the strained state of the global financial system. AIG posted
a first-quarter loss of $7.81 billion _ its second straight
quarterly loss _ and revealed plans to raise $12.5 billion in the
coming months. The world's largest insurer, like many of its peers
in the financial services sector, has seen its investments in the
credit markets plunge in value.
    Meanwhile, crude oil prices extended their trek into uncharted
territory, keeping Wall Street's inflationary concerns alive. In
premarket electronic trading on the New York Mercantile Exchange,
crude futures rose above $126 a barrel.
    In the first hour of trading, the Dow Jones industrial average
fell 120.90, or 0.94 percent, to 12,745.88.
    Broader stock indicators were also lower. The Standard & Poor's
500 index fell 12.16, or 0.87 percent, to 1,385.52, and the Nasdaq
composite index fell 19.75, or 0.81 percent, to 2,431.49.