Stocks rise and fall with twists in budget talks
Optimism that a budget deal will be reached in Washington sent stocks modestly higher on Thursday. A pair of economic reports also brightened the mood.
The Dow Jones industrial average rose 36.71 points to close at 13,021.82.
The stock market took a brief turn lower when House Speaker John Boehner, R-Ohio, said little progress was being made in budget talks in Washington. The Dow was up as much as 77 points in morning trading, turned negative as Boehner made his remarks at 11:30 a.m., then slowly recovered in the afternoon.
Investors were encouraged by several positive economic reports, including a higher estimate of third-quarter U.S. economic growth, an increase in home sales and a drop in claims for unemployment benefits.
After meeting with Treasury Secretary Tim Geithner, Boehner said Democrats still have not said which cuts they would accept to government benefit programs, suggesting a final budget deal remains a long way off.
Republicans have said they are open to increasing tax revenues as part of an agreement but only if they are accompanied by significant cuts to spending.
Investors have been closely watching the talks between the White House and Congress over the “fiscal cliff,” a reference to sharp government spending cuts and tax increases scheduled to start Jan. 1 unless a deal is reached to cut the budget deficit. New developments in the talks have whipsawed the market.
“It's a headline-watching market with this fiscal cliff,” said David Brown, chief market strategist of the investment research firm Sabrient Systems.
Brown says the negotiations are likely to cause the stock market to take sudden turns in the weeks ahead.
In other trading, the Standard & Poor's 500 rose 6.02 points to 1,415.95. The Nasdaq composite index gained 20.25 points to 3,012.03.
In the market for government bonds, the yield on the 10-year Treasury note slipped to 1.62 percent from 1.63 percent late Wednesday.
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- McCullers’, McLendon’s prowess in clogging trenches crucial to Steelers defense
- Rossi: Looking at the next great Steeler
- Steelers swap draft pick for Eagles cornerback
- Shell shovels millions into proposed Beaver County plant site
- Penguins not alone in top-heavy approach to salary cap
- After early criticism, Haley has Steelers offense poised to be even better
- Reds solve Cole, stave off Pirates’ 9th-inning rally
- Starting 9: Examining Pirates’ deadline decisions
- Inside the Steelers: QB Jones continues to get majority of snaps
- Pirates notebook: New acquisition Happ more than happy to fill spot in rotation
- Biertempfel: Players, MLB agree logic of season’s setup needs to be examined