Posted on July - 16 - 2011
Debt worries hang over the US stock market
NEW YORK – DEBT worries continue to hang over the stock market, overshadowing a string of strong earnings reports Monday.
Europe’s banking troubles and a debate over lifting the US government’s borrowing limit helped drag down markets in the US, Asia and Europe Monday.
Traders are keeping watch on negotiations in Washington to raise the US government’s debt ceiling. The Treasury Department says the limit must be raised by Aug 2 or the government risks defaulting on its debt. Rating agencies warned last week that the impasse puts the country’s top AAA credit rating grade at risk.
The results of stress tests on European banks released Friday did little to reassure investors. Of the 90 European banks tested for how they would fare in a recession, eight flunked. Another 16 barely passed.
The Dow Jones industrial average fell 97 points, or 0.8 per cent, to 12,382 in early trading. The S&P 500 index dropped 8 points, or 0.6 per cent, to 1,307. The Nasdaq fell 19 points, or 0.7 per cent, to 2,770.
Newspaper publisher Gannett Co, oil-field services company Halliburton Co and discount brokerage Charles Schwab Corp all reported higher earnings.
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