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Overnight Markets: Wall Street down as default concern increases
by Himanshu Singh on Oct 09, 2013 at 04:21
Wall Street declined on Tuesday amid little progress to end a political crisis in Washington that could lead to a government default and affect the US fiscal standing and economic recovery.
The Dow Jones industrial average fell 160 points or 1.07%, to 14,777, the S&P 500 lost 21 points or 1.23%, to 1,655 and the Nasdaq Composite dropped 76 points or 2%, to 3,695.
Equity markets showed growing concern over a partial US government shutdown and with only nine days left for Congress to raise the US debt borrowing limit.
President Barack Obama said the US economy risks a “very deep recession” if Congress doesn’t raise the debt ceiling. He turned up the political pressure on Republicans on Tuesday, saying he would be willing to negotiate on budget issues only after they agree to re-open the federal government and raise the debt limit with no conditions.
Facebook was among the biggest drags on the Nasdaq 100, down 6.7% on its worst day in more than a year. Shares of LinkedIn lost 6.1% and Netflix fell 5%.
McKesson Corp rose 3.2% after Dow Jones Newswires reported the company was in advanced talks to take over European drug distributor Celesio in a possible $5.1 billion deal.
Xerox Corp shares fell 2.5% after it said the US Securities and Exchange Commission was investigating some accounting practices at Affiliated Computer Services, an IT outsourcing firm it bought in 2010.
Alcoa shares rose 1.6% after the bell after the aluminum producer reported a third quarter profit. Yum Brands Inc, parent of KFC, was down 6.6% after the bell following results and lowered guidance.
Masco Corp. fell 5.3% after the maker of home improvement and building products faces slowing growth.
In Asia, shares fell on Wednesday in morning trade amid increasing concern over US debt default and after the International Monetary Fund slashed its global outlook.
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