US stocks slide as budget battle mounts

Publish date: Sat, 21 Sep 2013, 07:26 AM
NEW YORK: US markets slid on Friday, giving up much of the gains made on the Federal Reserve's no-taper decision, as the country girded for a disruptive Washington budget and debt showdown.

The Dow Jones Industrial Average shed 185.46 points (1.19 per cent) at 15,451.09. The broad-based SandP 500 dropped 12.43 (0.72 per cent) to 1,709.91, while the tech-rich Nasdaq Composite fell 14.65 (0.39 per cent) at 3,774.73.

The Dow gave up more than it had added in Wednesday's record-breaking surge after the Federal Reserve announced it would not begin closing its easy money stimulus spigot this month, greeted with surprise and enthusiasm by investors.

The SandP 500, which along with the Dow set new record closing highs Wednesday, held on to only a third of its gains.

Buying was dulled by comments from Fed official James Bullard that Wednesday's vote was close over reducing the US$85 billion a month bond-buying program, and his suggestion that it could still happen next month if economic data improves sufficiently.

"It's possible. I'm not saying its going to happen, but it's possible," Bullard said.

But a building showdown in Washington over the budget and debt ceiling, which threatens to shut down the government at the end of the month, also cast a shadow on trade.

House of Representatives Republicans passed a bill to fund the government but attached a requirement to kill funding for the White House's health-care reforms; the White House has already rejected such a measure.

BlackBerry stunned trade with a late announcement that it expected up to a US$1 billion loss in its second quarter, and that it would lay off 40 per cent of its workforce, or 4,500 jobs.

The cellphone maker's shares plunged 17.1 per cent to US$8.73.

Among leading companies, General Electric lost 1.8 per cent and IBM 1.7 per cent.

Volatile Facebook shares picked up 3.3 per cent, while Microsoft fell 2.5 per cent.

Electric sports car maker Tesla surged 3.1 per cent to a new closing high, US$183.39.

Dow member Caterpillar fell 1.4 per cent after reporting that its machinery sales fell in the last three months.

Prudential Financial dropped 0.6 per cent after US regulators classified the company as large enough to present systemic risk, a designation that means tighter regulatory oversight.

Darden Restaurants, which operates Red Lobster, Olive Garden and other chains, tumbled 7.1 per cent, after earnings of 53 cents per share missed expectations by 17 cents. -- AFP
Discussions
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buffetthe2nd

obama & co. said they will sell their asshole and pussy to keep funding their gov bill

2013-09-21 18:08

buffetthe2nd

and their opposing party said they r willing to pay billion and million for obama & co asshole and pussy

2013-09-21 18:11

buffetthe2nd

News just come out saying that Fed official James Bullard need a brain change surgery !! fresh new brain donation needed immediately!!

2013-09-21 18:17

buffetthe2nd

obama 1st customer is najis

2013-09-21 20:38

yeapmarghee

a bad news to all Bursa investors as we expect another exercise in sell=down
of shares by foreign fund managers in near future Am I right to express? pls comment and correct my mistake

2013-09-22 14:12

curiwangbagus

yeapmarghee, yes indeed foreigners will be selling in our bursa by the millions. Perhaps it's time to cabut cepat cepat come tomorrow morning and the days after. Please berhati hati yeapmarghee. Got money anytime can buy , so please wait for our index to drop further as I presume our bursa index is so high and there's no real & concrete proof that our bursa is heading north instead of south. Perhaps the last few days up so much is possibly of UMNO government's window dressing to show that come Malaysia Day, our economy is good & so our bursa index is tops. So beware kawan kawan, jangan di tipukan, berhati hati. Salam.

2013-09-22 14:25

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