In this Thursday, Jan. 10, 2013, photo, Trader Richard Newman checks prices as he works on the floor of the New York Stock Exchange. Stocks edged lower on Wall Street, with the Standard & Poor’s 500 slipping from close to a five-year high. Apple stocks tumbled on concern that demand for the iPhone 5 is waning. (AP Photo/Richard Drew)
NEW YORK — Stocks edged lower on Wall Street today as tensions rise in Washington over increasing the country's borrowing limit.
Treasury Secretary Timothy Geithner told congressional leaders in a letter late Monday that the U.S. government will reach its borrowing limit as soon as mid-February, earlier than expected. Federal Reserve Chairman Ben Bernanke also commented on the issue Monday, saying it was one of the “critical fiscal watersheds” for the government in coming weeks.
The Dow Jones industrial average fell 11 points to 13,495 as of 12:03 p.m. The Standard and Poor's 500 dropped two points to 1,468, the Nasdaq composite index fell 14 points to 3,102.
President Obama has criticized congressional Republicans for linking talks over raising the debt ceiling to ongoing budget negotiations. Obama said the consequences of the U.S. government defaulting on its debt would be disastrous and shouldn't be used as a bargaining chip to extract concessions on spending cuts
“We are very concerned how the market is going to respond to all the news events that will be coming out of Washington over the next few months,” said Eric Wiegand, a senior portfolio manager at U.S. Bank Wealth Management. “It really comes down to the uncertainty and the risk of a further downgrade of our debt.”
Markets were roiled in the summer of 2011 as lawmakers haggled over an increase to the debt limit. The dispute cost the U.S. its AAA ranking from the credit-rating firm Standard and Poor's.
Apple fell $17 to $484, its third consecutive daily drop. The stock hasn't closed below $500 in almost a year. Apple slumped 3.6 percent Monday on concern that demand for its iPhone 5 is slowing.
Stocks dropped today despite a report that retail sales increased in December. Consumers bought more autos, furniture, and clothing, despite worries about potential tax increases. Sales rose 0.5 percent in December from November, slightly better than November's 0.4 percent increase and the best showing since September, the Commerce Department said today.
Among other stocks making big moves;
— United Continental Holdings, the airline operator, fell 16 cents to $25.83 after JPMorgan cut its rating on the company to “neutral” from “overweight” to reflect the fact that stock has already advanced 40 percent in the past 12 months.
— Lululemon Athletica, a maker of yoga apparel, dropped $4.84 to $67.40 after its revenue forecasts fell short of revenue analysts’ estimates.
— Given Imaging Ltd. fell $2.07 to $16.13 after the medical equipment company said it was no longer considering a possible sale of the company and added that one of its largest shareholders plans to sell its stake.