NEW YORK (AP) — Investors sold stocks across the board Thursday as a U.S. government shutdown dragged into a third day and the U.S. inched toward a deadline on raising the nation’s borrowing limit.
The Dow Jones industrial average fell close to 200 points by late morning as Republicans and Democrats appeared no closer to ending the budget impasse. In a speech, President Barack Obama said there was only one way out of the shutdown: “Congress has to pass a budget that funds our government with no partisan strings attached.”
Investors also got some disappointing economic news on Thursday. The Institute of Supply Management said that sales fell sharply, new orders dipped and hiring weakened at U.S. service companies. The report covers industries including retail, construction, health care and financial services.
The stock market losses on Thursday marked an acceleration of gradual declines over the last two weeks. Stocks have fallen eight of the last 10 days as investors anticipated that negotiations over the federal budget would fail. If the shutdown persists, the weak economic recovery could falter. The U.S. Treasury Department said Thursday that the economy could plunge into a downturn worse than the Great Recession if Congress failed to raise the debt ceiling and the country defaulted on its debt obligations.