US open: Markets dip as investors await news on fiscal cliff situation

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LONDON (ShareCast) - US markets have edged into negative territory as President Obama flies home early from his holiday in Hawaii to meet with lawmakers back in Washington.

With just four days left until the deadline, investors are becoming increasingly nervous over whether leaders will be able to find a solution to the looming 'fiscal cliff' which will bring with it a raft of tax hikes and spending cuts.

Yesterday saw Treasury Secretary Timothy Geithner write a letter to congressional leaders saying that he needs to authorise extraordinary measures to prevent the US reaching its debt ceiling of $16.4trn on December 31st.

The move would be a temporary one which gives the government headroom of $200bn - although because of the uncertainty surrounding the fiscal cliff, it is not yet known how long that amount will last.

Geithner said the move could give leaders some additional time in the event they are unable to shake hands on a new deal.

Comments from LaTourette

Speaking to CNN on Thursday, Steven LaTourette, the Republican US Representative, said: "This isn't a one party or one house problem. This is [that] leaders in both parties in all branches of the government are not willing to make the deal that they know they have to make. Everybody wants their stuff but doesn't want to give up what they don't want to give up."

Jobs data

Meanwhile, economic data has revealed a drop in jobless claims, which fell 12,000 to 350,000.

According to Barclays Research, the fall is most likely due to holiday effects.

Other markets

With hope still remaining that a deal can be stuck, the US dollar has fallen, pushing the dollar index to 79.403, compared to 79.424.

Front month crude futures rose 0.35% to $91.30 per barrel on the New York Mercantile exchange.




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Expedia Inc (NasdaqGS: EXPE - news) . (EXPE) $60.34 +4.16%
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Coach Inc (NYSE: COH - news) . (COH) $54.94 +1.50%
Fossil Inc (NasdaqGS: FOSL - news) . (FOSL) $90.59 +1.41%
Frontier Communications Co. (FTR) $4.22 +1.32%
Intuitive Surgical Inc (NasdaqGS: ISRG - news) . (ISRG) $486.39 +1.30%
Cliffs Natural Resources Inc (NYSE: CLF - news) . (CLF) $36.51 +1.27%
Sears Holdings Corp. (SHLD) $39.88 +1.26%
Perrigo Company (NasdaqGS: PRGO - news) (PRGO) $104.13 +1.21%
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Noble Corp (NYSE: NE - news) (NE) $34.61 -1.51%
Discover Financial Services (NYSE: DFS - news) (DFS) $37.78 -1.46%
Southwestern Energy Co (NYSE: SWN - news) . (SWN) $32.86 -1.29%
Ford Motor Co (NYSE: F - news) . (F) $12.63 -1.25%
Xerox Corp (NYSE: XRX - news) . (XRX) $6.82 -1.23%
US Bancorp (USB) $31.90 -1.12%
Jacobs Engineering Group Inc. (JEC) $42.15 -1.08%

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Microsoft Corp. (MSFT) $26.90 +0.15%
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American Express Co. (AXP) $56.87 -0.46%
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BMC Software Inc (NasdaqGS: BMC - news) . (BMC) $40.10 -0.72%
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O'Reilly Automotive Inc. (ORLY) $88.34 -0.56%
Activision Blizzard Inc (NasdaqGS: ATVI - news) . (ATVI) $10.61 -0.56%

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