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Overnight Markets: Wall Street declines amid budget impasse
by Himanshu Singh on Sep 26, 2013 at 03:33
Wall Street fell on Wednesday, with the S&P 500 registering it’s fifth day of losses, after Wal-Mart Stores retreated and concern increased that a political showdown over government spending poses a threat to growth.
The Dow Jones industrial average was down 61 points, or 0.4%, at 15,273. The Standard & Poor's 500 Index was down five points, or 0.27%, at 1,693. The Nasdaq Composite Index was down seven points, or 0.19%, at 3,761.
Congress needs to pass stop-gap funding for federal agencies by 1 October and it must raise the federal borrowing limit to avoid a debt default by the US by 17 October. A government shutdown could begin with the new fiscal year that begins on 1 October unless funds are authorised.
In economic data, orders for long-lasting US manufactured goods barely grew in August in a possible sign that companies are holding back on investment spending.
Another report showed sales of new single-family homes rose in August but held near their lowest levels this year because of higher mortgage rates.
Shares of Wal-Mart (WMT.N) declined after a report by Bloomberg News that the world's largest retailer was cutting orders to its suppliers for this quarter and next. The stock retraced some of its losses after the company called the report inaccurate and ended down 1.5%.
J.C. Penney Co Inc (JCP.N) ended down 15% after hitting a 13-year low of $9.94, as Goldman Sachs said it expects sales at the troubled department store chain to improve more slowly than expected.
Other decliners included Carnival Corp (CCL.N), whose shares fell 5.3%. The company warned it could report an adjusted loss for the current quarter and several brokerage downgraded its stock.
On the positive side, Facebook (FB.O) shares rose 2.1%. JPMorgan Chase (JPM.N) were up 2.7% after media reports said it is in talks with government officials to settle federal and state mortgage probes for $11 billion.
Shares of contract electronics maker Jabil Circuit (JBL.N) declined 5.1% after the bell after it reported results and issued guidance. Bed Bath and Beyond (BBBY.O) rose 3.8% after the close following the release of its results.
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