The stock markets in the United States remained in a losing streak as the government shutdown continues and investors are worried over a potential default if lawmakers will not reach an agreement to raise the debt ceiling prior to the deadline on October 17.
Leaders of Congress remained deadlocked on the issue of a debt ceiling. The leaders of the Republicans in the lower chamber said that the leadership of the Democratic Party in the Senate must take action to resolve the gridlock.
Senate Majority Leader Harry Reid maintained his position that the Republicans in the House of Representatives should end the government shutdown and abandon their demands related to the Affordable Care Act (ACA). On the other hand, House Speaker John Boehner said Reid and President Barack Obama should negotiate.
During a press conference at the White House today, President Obama warned that the U.S. economy is at risk of a “very deep recession” if Congress fails to raise the debt ceiling. According to the President, he is willing to talk with the Republicans on any issue including changes in the health care law once they end the shutdown and raise the borrowing limit.
President Obama said, “Let’s lift these threats from our families and our businesses.” The President blamed a few members of Congress for “creating a threat that puts the economic recovery at risk.” He said, the administration is “exploring all contingencies,” and pointed out that the United States cannot afford going through “manufactured crises every few months.” He added, “We can’t make extortion routine as part of our democracy.”
Meanwhile, Bruce Josten, chief lobbyist at the U.S. Chamber of Commerce, said Congress must pass the spending bill and legislation to raise the debt limit. He pointed out that lawmakers should increase the debt ceiling on time to “avoid inflicting substantial and enduring damage to the U.S. economy.”
- Dow Jones Industrial Average (DJIA)- 14,776.53 (-1.07%)
- S&P 500- 1,655.45 (-1.23%)
- NASDAQ- 3,694.83 (-2.00%)
- Russell 2000- 1,049.39 (-1.54%)
- EURO STOXX 50 Price EUR- 2, 903.35 (-0.79%)
- FTSE 100 Index- 6,365.83 (-1.11%)
- Deutsche Borse AG German Stock Index DAX- 8,555.89 (-0.42%)
Asia Pacific Markets
- Nikkei 225- 13, 894.61 (+0.30%)
- Hong Kong Hang Seng Index- 23,178.85 (+0.89%)
- Shanghai Shenzhen CSI 300 Index- 2, 441.81 (+1.36%)
Stocks In Focus
The stock price of Alcatel Lucent SA (NYSE:ALU) (EPA:ALU) declined to as low as $3.36 per share, down by 9% after announcing its plan to cut 10,000 jobs or 14% of its workforce worldwide. According to the company, the workforce reduction is part of its commitment to achieve cost savings of €1 billion annually and to restore its profitability.
Masco Corporation (NYSE:MAS) dropped more than 5% to $19.41 a share after a Keybanc Capital Markets analyst lowered its rating for the stock from Hold to Underweight. The company is facing slow growth and it could lose market share. Wall Street analysts have a consensus Hold rating for the stock.
The stock value of Xerox Corporation (NYSE:XRX) declined by 2.21% to $10.17 per share after the company revealed that the Securities and Exchange Commission (SEC) is investigating the accounting practices of one of its business units, Affiliated Computer Services. Regulators are trying to find out if the company’s revenue from its ACS equipment and resale transaction should be have been posted on a net instead of gross basis.