New York City (AFP) – U.S. stocks tumbled in early trade Monday as a shutdown of the government loomed after Washington lawmakers failed to bridge their differences over the federal budget.
About 40 minutes into trade, the Dow Jones Industrial Average fell 125.75 (0.82 percent) to 15,132.49.
The broad-based S&P 500 retreated 12.12 (0.72 percent) at 1,679.63, while the tech-rich Nasdaq Composite Index gave up 28.01 (0.74 percent) at 3,753.59.
Analysts said a government shutdown at midnight Monday would not likely have a huge impact on the U.S. economy.
But the paralysis has raised concerns the two sides will not reach agreement on the more critical issue of raising the debt ceiling in mid-October.
“The market is nervous and maybe the market is looking at it as an excuse to sell off,” said Peter Cardillo, chief market economist at Rockwell Global Capital.
Financial stocks suffered amid concerns that the Washington gridlock could derail the U.S. economic recovery. Dow members American Express and Goldman Sachs each lost 1.0 percent.
Some large technology companies also sank, including Dow member Microsoft (-1.3 percent), Yahoo (-1.0 percent),online retailer Amazon (-1.2 percent) and social networking giant Facebook (-0.8 percent).
Achillon Pharmaceuticals plummeted 53.0 percent after announcing that the Food and Drug Administration decided to maintain its “clinical hold” on its sovaprevir treatment for the chronic hepatitis C virus. Achillon said it would continue to work with the FDA to try to progress the drug.
Bond prices were unchanged. The yield on the 10-year Treasury held flat compared with Friday at 2.62 percent, while the 30-year was steady at 3.68 percent. Prices and yields move inversely.
Copyright 2013 The National Memo