Stock prices on the US and European stock exchanges fell on Tuesday, as market participants waited for possible developments in the negotiations on the prevention of US debt default.
Investor sentiment was also dampened by data on China’s weak economic recovery.
US retail sales in April increased by 0.4% compared to the previous month, thus registering a smaller increase than the forecasted 0.7%, according to data published by the Ministry of Commerce on Tuesday.
US retailer Home Depot’s earnings fell in the first quarter as consumer spending slowed.
The US dollar rose against other major currencies, while oil prices fell.
“There are growing concerns that not enough progress is being made to prevent a US default that would send shock waves through financial markets,” said Suzanne Streeter, head of money and markets at Hargreaves Lansdown.
Speaker of the US House of Representatives, Kevin McCarthy, said after a meeting at the White House that there is still much work to be done in negotiations to raise the federal borrowing limit and prevent a potentially catastrophic credit default. The deadline for reaching an agreement is in a few days.
Republicans are demanding spending cuts as a condition for passing a debt ceiling bill, while Democrats want an unconditional debt ceiling increase.
The Dow Jones Industrial Average fell 1.0% to 33,012.14 on Tuesday, the Standard & Poor’s 500 fell 0.6% to 4,109.90, and the Nasdaq Composite fell 0.6%. 0.2% to 12,343.05 points.
London’s FTSE 100 fell 0.3% to 7,751.08 on Tuesday, Frankfurt’s DAX fell 0.1% to 15,897.93 and Paris’ CAC 40 fell 0.2% to 7,406 .01 for the point.
WTI crude oil fell 0.4% to $70.86 a barrel in electronic trading on the New York Stock Exchange on Tuesday. “Brent” crude oil price on the London exchange decreased by 0.4% to 74.91 dollars per barrel.
On the Dutch exchange “Title Transfer Facility” (TTF) natural gas price fell by 1.53% to 31.82 euros per megawatt hour on Tuesday.
The euro was down from $1.0874 to $1.0865 per euro on Tuesday, the British pound was down from $1.2529 to $1.2483 per pound, and the dollar was up against the Japanese yen from 136.12 to 136.37 yen per dollar. The euro rose against the British pound from 86.80 to 87.01 pence per euro.
