• Specialist Michael Pistillo, left, trader Edward Schreier, right, on the floor of the New York Stock Exchange Tuesday, Jan. 6, 2015. The U.S. stock market is edging higher in early trading as the price of oil extends its slump. (AP Photo/Richard Drew)

    Specialist Michael Pistillo, left, trader Edward Schreier, right, on the floor of the New York Stock Exchange Tuesday, Jan. 6, 2015. The U.S. stock market is edging higher in early trading as the price of oil extends its slump. (AP Photo/Richard Drew) (The Associated Press)

  • Specialist Mario Picone, right, works at his post on the floor of the New York Stock Exchange Tuesday, Jan. 6, 2015. The U.S. stock market is edging higher in early trading as the price of oil extends its slump. (AP Photo/Richard Drew)

    Specialist Mario Picone, right, works at his post on the floor of the New York Stock Exchange Tuesday, Jan. 6, 2015. The U.S. stock market is edging higher in early trading as the price of oil extends its slump. (AP Photo/Richard Drew) (The Associated Press)

  • Traders gather at a post on the floor of the New York Stock Exchange Tuesday, Jan. 6, 2015. The U.S. stock market is edging higher in early trading as the price of oil extends its slump. (AP Photo/Richard Drew)

    Traders gather at a post on the floor of the New York Stock Exchange Tuesday, Jan. 6, 2015. The U.S. stock market is edging higher in early trading as the price of oil extends its slump. (AP Photo/Richard Drew) (The Associated Press)

Investors seek refuge in bonds as the price of oil continues to collapse; Stock indexes sink

Energy Associated Press

Bonds are rallying and stocks are slumping as investors worry that the price of oil will continue to plunge.

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Crude dropped another $2 to close just below $48 a barrel Tuesday, the lowest price since April 2009.

The collapse in oil prices has traders worried that the global economy may be slowing. They are also concerned that energy companies could slash their spending and cut jobs.

The Dow Jones industrial average lost 130 points, or 0.7 percent, to 17,371. That's on top of a 331-point drop the day before.

The Standard & Poor's 500 index fell 18 points, or 0.9 percent, to 2,002. The Nasdaq composite fell 59 points, or 1.3 percent, to 4,592.

Bond prices rose. The yield on the 10-year Treasury note fell sharply, to 1.95 percent.