US stocks fall again as key debt deadline looms

NEW YORK – Wall Street stocks fell again on Wednesday on rising anxiety over US debt ceiling talks as a critical deadline nears without an agreement.

President Joe Biden offered to freeze government spending at current levels, a move that would reduce the deficit by US$1 trillion (S$1.3 trillion) and marks a concession to congressional Republicans.

The US government could run out of money to pay for its existing obligations as early as June 1, according to Treasury Secretary Janet Yellen.

“Everyone has seen this movie before and now we are finally starting to see some market stress as debt-ceiling talks remain at an impasse,” said Oanda’s Edward Moya.

The Dow Jones Industrial Average dropped 0.8 per cent to 32,799.92.

The broad-based S&P 500 shed 0.7 per cent to 4,115.24, while the tech-rich Nasdaq Composite Index declined 0.6 per cent to 12,484.16.

Minutes from the latest Federal Reserve meeting showed economists at the central bank still expected a “mild recession” earlier this month.

“Real GDP was projected to decelerate over the next two quarters before declining modestly in both the fourth quarter of this year and the first quarter of next year,” according to the Fed.

Among individual companies, Citigroup rose 1.3 per cent as it announced a plan to spin off its Mexican consumer banking unit Banamex in a public offering.

Cybersecurity company Palo Alto Networks advanced 7.7 per cent as it reported a 24 per cent jump in quarterly revenues and lifted some of its full-year profit benchmarks.

Retailers Abercrombie & Fitch and Kohl’s both surged following better than expected results, with Abercrombie rising more than 31 per cent and Kohl’s 7.6 per cent. AFP

 

Source: https://www.straitstimes.com/business/companies-markets/us-stocks-fall-again-as-key-debt-deadline-looms

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