“Wall Street struggles with regional bank volatility as debt ceiling crisis looms”

Jakarta, CNBC Indonesia – The United States (US) stock market or Wall Street weakened in early trading Tuesday local time. Regional bank stocks that are still volatile are one of the factors that make it difficult for Wall Street to strengthen.

The Dow Jones index fell 0.2%, the S&P 500 0.5%, and the Nasdaq led the decline of 0.7%.

PacWest bank shares opened down 6% after being able to gain 3% yesterday despite volatile trading. The decline in US regional bank shares was reflected in the PDR S&P Regional Banking ETF (KRE) which fell 1% early in the session.

Market participants are currently awaiting a meeting between US President Joe Biden and Republican House Speaker Kevin McCarthy. Both parties previously stated that this was an ordinary conversation, and that an increase in the debt ceiling would not occur at this meeting.

As is well known, the United States is again experiencing debt problems which have reached a ceiling limit of US$ 31.4 trillion. If it is not increased, then the United States is threatened with default. This has been one of Wall Street’s pressures in recent weeks.

The US Treasury Secretary, Janet Yellen, has repeatedly warned about this. He said the US will run out of budget in early June.

“Our current projection is that in early June, a day will come when we can’t pay our bills unless Congress raises the debt ceiling,” Yellen said in the program, Sunday, (7/5/2023), as proclaimed CNBC International.

“That is something I strongly urge Congress to do,” he said.

(pap/pap)