US stocks slump as investors wait for Washington to edge away from default risk

NEW YORK, N.Y. – The stock market is closing sharply lower as budget gridlock in Washington brings the U.S. closer to a default on its debt.

The impasse over the government shutdown and raising the country’s borrowing limit showed no signs of breaking Tuesday.

House Republicans have insisted that any temporary funding bill contain concessions on President Barack Obama’s health care law.

The Standard & Poor’s 500 index closed down 20 points, or 1.2 per cent, to close at 1,655.45. It was the 11th loss in the last 14 days, and the index’s biggest drop in six weeks.

The Dow Jones industrial average was down 159 points, or 1.1 per cent, to 14,776.53.

The Nasdaq composite fell 75 points, or 2 per cent, to 3,694.83, also the largest drop in six weeks.

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