The US markets fell sharply on Tuesday, hit by growing jitters over the budget impasse in Washington, with few signs of a deal to end it or raise the nation’s debt ceiling with the partial government shutdown extending into a second week. President Obama said that he is happy to negotiate with House Republicans but not under the threat of keeping the government closed or not raising the debt ceiling. House Speaker John Boehner replied that Obama and Democrats need to negotiate over the US debt ceiling and shutdown. The House of Representatives isn’t likely to pass a debt-ceiling increase this week. A failure to raise the debt limit by October 17 would mean the US couldn’t borrow money to pay its bills, triggering an unprecedented default.
On the economy front, small-business sentiment edged lower in September on a big drop in the percentage who expected the economy to improve, the National Federation of Independent Business stated. The NFIB small-business optimism index fell to 93.9 from a corrected 94.1 in August. The pessimism on the economy helped to offset rising percentages expecting higher sales. Four index components improved, four fell and two remained unchanged from August.
The Dow Jones Industrial Average lost 159.71 points or 1.07 percent to 14,776.50, the S&P 500 was down 20.67 points or 1.23 percent to 1,655.45, while Nasdaq dropped 75.54 points or 2.00 percent to 3,694.83.
Indian ADRs closed in red on Tuesday; HDFC Bank was down 1.40%, ICICI Bank was down by 1.35%, Infosys was down 1.08%, Dr. Reddy’s Lab was down 0.51% and Tata Motors was down 0.47%.
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