As traders and investors are weighing the possibility that the U.S. government might shut down on October 1st, U.S. stocks fell for a fourth day. Market observers believe that even if a shutdown is avoided, the bigger concern is whether Congress will raise the debt ceiling before the drop-dead deadline of October 18.
As of now no deal is in sight between the House, Senate and White House to pay the nation’s bills after midnight on Sept. 30. Observers claim that if something like that does not happen, the government risks defaulting on its debt which may cause a further downgrading of the credit rating.
Analysts also view that the decline in the U.S. stocks can be attributed to investors are weighing prospects for easing tensions in the Middle East after Syria decided to surrender its chemical weapons this month.
Rally Time for Facebook
Yesterday’s trading showed that Facebook is still a preferred investment as its shares rose nearly 3% and hit a new all-time high. Facebook has been doing wonderfully in the stock market and topped its previous record of $45 from its IPO day. Now it trading around $50 a share and expected to do better amidst the news that it may expand its operations in China as the country is freeing its internet restrictions.
Better Indication for the Housing Sector
According to analysts the foundation for the housing recovery hasn’t been shaken by the threat of rising rates as two of the nation’s largest homebuilders have been showing better-than-expected quarterly figures. The largest U.S. homebuilder, Lennar LEN +4.26% Corp. has got more than $120.7 million in profits and its share went up by 54 cents.
Similarly, KB Home, a company that serves mainly on the West Coast, also reported that its profit went up by $27.3 million. Its stocks’ value has increased by 30 cents and according to Wall Street’s estimates the revenue has shot up 29% to $549 million.
On the other hand, Applied Materials Inc. (AMAT) also advanced 9.1 percent. Its growth is attributed to its agreement to buy Tokyo Electron Ltd. for about $9.39 billion in stock.
Red Hat Inc. an American multinational software company that is engaged in providing open-source software products to the enterprise community slumped 12 percent after billings at the largest seller of the Linux operating system trailed estimates. It shares opened higher at 47.75 and traded up at 47.91 at some point; however, declined and closed at 46.73.
To contact the reporter of this story: Jonathan Millet at email@example.com