Late-afternoon visitors climb a stairway outside the U.S. Capitol in Washington, September 28, 2013.
Stocks are now down in seven of the last eight trading sessions.
First, the scoreboard:
- Dow: 15,129.6, -128.5, -0.8 %
- S&P 500: 1,681.5, -10.2, -0.6%
- NASDAQ: 3,771.4, -10.1, -0.2%
And now the top stories:
- It looks like we're heading for a government shutdown. The fiscal year ends at midnight, and Congress continues to quibble over a budget deal.
- "We put a high probability (four-out-of-five) on nonessential federal government workers staying home on Tuesday," said Morgan Stanley's Vincent Reinhart. "This amounts to about 800,000 employees and would trim annual GDP growth by approximately 15 basis points per week of closing. ... Scheduled interest and principal payments on Treasury obligations will continue to be paid. The fiscal agent of the Treasury is the Federal Reserve, which is outside the federal budget and will continue to operate."
- "This sort of political brinkmanship is the dominant reason the [U.S.] rating is no longer 'AAA'," wrote the credit analysts at S&P today. "In our opinion, the current impasse over the continuing resolution and the debt ceiling creates an atmosphere of uncertainty that could affect confidence, investment, and hiring in the U.S."
- A government shutdown would mean that many key economic reports published by public agencies won't get released in a timely manner. However, the private-sector reports will continue to come out.
- Today, we learned that the Chicago PMI jumped to 55.7 in September from 53.0 in August. This was much stronger than the 54.0 expected by economists. "While the pick-up is welcomed, growth is far from solid," said MNI Indicators' Philip Uglow. "The easing in the employment component is a notable setback this month, underlying the fragility of the recovery."
- The Dallas Fed's manufacturing activity index surged to 12.8 from 5.0 in August. This beat expectations for a reading of 5.5.
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