Wall Street fell on uncertainty in negotiations on the US debt ceiling

Wall Street fell on uncertainty in negotiations on the US debt ceiling

The Dow Jones Industrial Average fell 0.3%; the S&P 500 index fell 0.1%; and the Nasdaq Composite lost 0.2%.


The main Wall Street indices closed the trading day this Friday on a weak notesince the initial gains vanished after the interruption of the negotiations on the fiscal debt limit in Washington, which undermined the confidence that there will be an agreement in the coming days to avoid default.

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The Dow Jones Industrial Average fell 109.28 points, or 0.3%, to 33,426.63; The S&P 500 index fell 6.07 points, or 0.1%, to 4,191.98; and the Nasdaq Composite lost 30.94 points, or 0.2%, to 12,657.90.

“The market seemed to go into the weekend thinking that the talks were going to move towards the framework for an agreement (…) but what you are seeing now is the Republicans saying, no, this is not acceptable, and they simply organized an abandonment”said Quincy Krosby, chief global strategist at LPL Financial.

And he added: “It could be to put more pressure on the Democratic caucus and also take advantage of the fact that Biden is abroad. But this news on a Friday afternoon is definitely not positive.”

Indices opened higher on optimism that a deal could be reached to raise the debt limit to $31.4 trillion this weekend. However, news of the pause sent indicators tumbling in a volatile session as the Federal Reserve Chairman, Jerome Powellwas speaking at a monetary policy panel.

Powell said the fallout from recent banking sector woes is taking some of the pressure off the Fed to raise interest rates, while a separate report indicated that Treasury Secretary Janet Yellen pointed to bank CEOs Thursday that more bank mergers may be necessary after the recent bankruptcies.

Source: Ambito

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