Wall Street slips on potential government shutdown
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U.S. Stock splunged on Friday, amid surging oil prices, and as Congress seemed on track to trigger a government shutdown by failing to agree to a budget for the rest of the fiscal year.
Investors were wary of the effects of a possible U.S. government shutdown if President Barack Obama and Congress are unable to agree to a new spending bill. After a volatile trading day due to the European Central Bank's interest rate hike and new strong earthquake in Japan, the markets extended losses on Friday as investors concerned that the shut down might hurt U.S. economic recovery.
U.S. crude oil price surged on Friday and hit a new 2.5-year high as concerns about supply in the Middle East persisted and the dollar weakened against most major currencies.
Light, sweet crude oil for May delivery jumped US$2.49, or 2.26 percent, to settle at US$112.79 a barrel at the New York Mercantile Exchange, ending this week with a rise of 4.5 percent.
The dollar index, dipped to 75.102 in late Friday from 75.553. A weaker dollar often lifts dollar- denominated commodities.
The blue-chip Dow Jones Industrial Average lost 29.44 points, or 0.24 percent, to 12,380.05. The broader Standard and Poor's 500 Index shed 5.34 points, 0.4 percent, to 1,328.17. The technology- heavy Nasdaq Composite Index fell 15.72 points, or 0.56 percent, to 2,780.42.
U.S. stocks had been up slightly early in Friday's session, but that advance evaporated as investors looked toward the midnight deadline for the federal government's fiscal 2011 budget. A continued impasse would set the stage for the U.S. government's first shut down in 15 years.
Xinhua contributed to this story.
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