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Tokyo

New York - Embattled insurance giant American International Group (AIG) will receive a government loan of 85 billion dollars to give the conglomerate time to sell off assets to avoid bankruptcy, business news channel CNBC reported late Tuesday.

Citing unnamed sources, the broadcaster said that the federal government would receive a state of 80 per cent in AIG, in exchange for the bridge loan.

Remaining AIG stockholders would lose most of their equity in the deal, CNBC reported.

The insurer, facing a possible bankruptcy filing as early as Wednesday, is seeking help through the Federal Reserve, the US central bank.

New York - The giant insurance conglomerate American International Group (AIG) remained tottering on the brink of collapse Tuesday, with no end in sight to emergency rescue talks between company executives, government officials and private stakeholders.

As time was quickly running out, there was still no outcome Tuesday afternoon from five-day-long talks at the New York Federal Reserve. AIG in a statement said it was continuing to pursue a variety of options.

AIG, the largest US insurer, needs as much as 75 billion dollars in loans to stay afloat. Three major US credit rating agencies downgraded AIG's standing Tuesday morning.

New York/Washington  - US stocks made strong gains after a wild day of trading Tuesday, pulling back from the worst day on Wall Street since the September 2001 terrorist attacks.

The Dow Jones Industrial Average rose 1.3 per cent, largely on investors' hopes that the government would come to the rescue of American International Group Inc (AIG), the largest US insurer. The broader Standard & Poor's 500 Index surged 1.75 per cent.

New York  - Major US stock indices were recovering Tuesday after turmoil in the financial sector on Monday led to the worst day on Wall Street since the September 2001 terrorist attacks.

The Dow Jones Industrial Average was up 40 points early Tuesday afternoon, despite opening the trading day down about 150 points. The Dow plunged more than 500 points, or 4.4 per cent, on Monday.

The broader Standard & Poor's 500 was down as much as 1.8 per cent in early trading, but was posting a 0.5-per-cent gain by the late morning, after plunging 4.7 per cent Monday.