* Financial jitters drive global equity sell-off
* AIG shares tumble on capital adequacy fears
* Goldman shares sink after profit slumps 70 pct
* Fed to decide on rates, verdict eagerly awaited
(Adds details, update prices)
By Ellis Mnyandu
NEW YORK, Sept 16 (Reuters) - U.S. stocks headed for a
sharply lower open on Tuesday as investors fretted about
insurer American International Group's <AIG.N> ability to
secure desperately needed capital to avert more credit agency
downgrades.
In addition, computer maker Dell Inc <DELL.O> said it was
seeing further softening in global demand for technology, which
further soured the tone after Wall Street's worst day on Monday
since markets reopened after the Sept. 11, 2001 attacks.
Shares of AIG dropped more than 30 percent to $3.32, while
Dell fell more than 8 percent to $16.50 before the opening
bell.
Elsewhere in the financial sector, Goldman Sachs <GS.N>
fell to 2 1/2-year lows, down more than 6 percent at $127.12
after the investment bank posted a 70 percent slide in
third-quarter profit.
Worries about AIG were also accentuated by concerns that
the U.S. government might again refuse to provide a financial
lifeline to a major firm after it balked at a federal bailout
for Lehman Brothers Holdings. The 158-year-old Wall Street icon
subsequently filed for bankruptcy.
"A lot is riding on AIG. They got hung up in the real
estate debacle," said Andre Bakhos, president of Princeton
Financial Group in Princeton, New Jersey. "The longer we go
without a tentative deal to inject capital into AIG, the worse
things will get."
S&P 500 futures <SPc2> fell 26.40 points and were below
fair value, a formula that evaluates pricing by taking into
account interest rates, dividends and time to expiration on the
contract. Dow Jones industrial average futures <DJc2> dropped
159 points and Nasdaq 100 <NDc2> futures shed 25.50 points.
New York Gov. David Paterson told CNBC television that AIG
has a day to fix its problems. For details, see []
Federal Reserve policy-makers met on Tuesday to decide on
interest rate policy and could leave rates steady. Investors
will scrutinize the accompanying statement for clues about the
prospects for corporate profits.
"Unless the Fed cuts this afternoon, I don't think it's
going to be a good day," said Cleveland Rueckert, market
analyst at Birinyi Associates Inc, in Stamford, Connecticut.
The decline in AIG, a Dow component, comes after the demise
of investment bank Lehman, which filed for bankruptcy
protection because of losses stemming from the U.S. housing
slump.
Unease about financial services companies drove investors
into the relative safety of government debt as global equity
markets sold off.
(Editing by Kenneth Barry)
