Morning Market Movers: Everything Focused on Debt Ceiling Vote
Here’s what’s shaking:
Stock markets traded cautiously on Wednesday ahead of a U.S. vote on raising the nation’s borrowing limit temporarily.
The House is set to vote on a motion to increase the nation’s $16.4 trillion borrowing ceiling for three months. Without congressional action, the Treasury sometime in late February or early March will not have enough money to pay all of its obligations, raising the risk of a first-ever default on the government’s debts.
By late morning in Europe, stock indexes were lacking momentum. Britain’s FTSE 100 was up 0.2 percent at 6,189.55 while Germany’s DAX rose 0.3 percent to 7,719.21. France’s CAC-40 lost 0.1 percent to 3,737.18.
Corporate earnings in Europe showed a mixed outlook. Consumer goods maker Unilever and pharmaceuticals company Novartis reported good gains, but industrial conglomerate Siemens and software maker SAP saw their earnings drop.
Wall Street, meanwhile, was headed for a weak open. Dow Jones industrial futures were flat at 13,696 while S&P 500 futures were 0.1 percent lower at 1,488.10.
Earlier in Asia, Japanese stocks reacted negatively for a second day to the central bank’s plans for shoring up the economy.
The Nikkei 225 in Tokyo tumbled 2.1 percent to close at 10,486.99, a day after the Bank of Japan set its target inflation rate at 2 percent and said it would undertake open-ended asset purchases starting in 2014. Some analysts said investors were disappointed that the central bank didn’t take more aggressive measures.
The price of oil was steady near four-month highs around $97 a barrel on Wednesday as markets awaited a vote in Congress which would provide a temporary solution to the debt ceiling crisis and avoid America’s first-ever default.
By early afternoon in Europe, benchmark oil for March delivery was up 13 cents at $96.81 a barrel in electronic trading on the New York Mercantile Exchange.
Price gains were limited by relatively weak monthly data of home sales and manufacturing, which raised concerns about the U.S. economy’s growth prospects.
They were supported, on the other hand, by progress in a pipeline project which would transport crude from Canadian oil sand fields to refineries along the U.S. Gulf Coast.
Brent crude, used to price international varieties of oil, was up 6 cents to $112.48 per barrel on the ICE Futures exchange in London.
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Featured image courtesy the AP.
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