US stocks are falling as debt ceiling talks drag on

US stocks fell as the debt ceiling talks dragged on with no solution.

The S&P 500 was down 0.7%, the NASDAQ Composite was down 0.8%, and the Dow Jones Industrial Average was down 203 points, or 0.6%, at 10:17 ET (14:17 GMT).

A deadline in early June has investors hoping that the debt ceiling impasse in Washington will be resolved. Imagine if Congress doesn’t increase or suspend the ceiling. According to economists and Biden administration officials, the government runs the risk of failing to meet its obligations, which could destabilise the financial system.

Although the sides still look far apart as of Wednesday morning, Democrats and Republicans are attempting to iron out specifics on spending levels as part of striking an agreement.

Investors are also anticipating the release of the Federal Reserve’s meeting minutes from its most recent policy meeting, during which rates were increased by another quarter of a percentage point. Since then, officials have said that they may need to take a break in June while they evaluate how well their efforts to reduce inflation have been working.

The personal consumption expenditures report, which the Fed constantly monitors as it determines monetary policy, will be one important data source.

Market volatility is increasing due to uncertainty; on Wednesday, the CBOE Volatility Index, or VIX, increased 10.9% to a level of slightly over 20.

After the bank announced it would spin off its business in Mexico in an IPO after trying to find a buyer for it, Citigroup Inc (NYSE:C) stock dropped 3%.

Following the department store operator’s release of better-than-anticipated quarterly earnings, which included a surprise profit, Kohl’s Corp (NYSE:KSS) shares increased 10%.

Oil was increasing. Brent Oil Futures up 1.5% to $78.02 per barrel and Crude Oil WTI Futures increased 1.6% to $74.08 per barrel. To $1,970, gold futures were down 0.2%.