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Sector movers: Stocks dip amid debt ceiling concerns

By Alexander Bueso

Date: Tuesday 23 May 2023

Sector movers: Stocks dip amid debt ceiling concerns

(Sharecast News) - Cyclicals were at the bottom of the pile on Tuesday as some investors grew a bit more concerned about the ongoing debt ceiling impasse in the States.
"With the clock continuing to tick down towards the US debt ceiling deadline of 1st June, and US policymakers no nearer to a deal, European markets are finding little inclination to move higher, with the DAX and CAC40 sliding back for the second day in a row," said Michael Hewson, chief market analyst at CMC Markets UK.

Overnight, President Biden and US House of Representatives speaker, Kevin McCarthy, held another round of talks which they both described in positive terms.

But for the moment at least, a deal continued to elude both.

Also on Monday evening, analysts at Oxford Economics, told clients that the US Treasury was facing a "significant" risk of not being able to pay all of its obligations on time in early June.

A default on debt payments was not an immediate risk, they said.

They also estimated that the Treasury could get to 14 June without exhausting its cash - but there was no room for error.

But the Treasury's ability to pay hundreds of billions of dollars in other bills was indeed nevertheless at risk.

That included Social Security, Medicare and other benefits payments at the start of June.

Going the other way, defensive areas of the market such as Tobacco, Telecoms and precious metals' miners found a bid.

So too did Big Oil, helped perhaps by a warning from top Saudi energy official, Prince Abdulaziz bin Salman, who told speculators to "watch out!".

The OPEC+ cartel was next due to review its output policies on 3-4 June.

Top performing sectors so far today

Tobacco 30,073.63 +2.12%

Telecommunications Service Providers 2,279.26 +1.89%

Real Estate Investment Trusts 2,264.71 +1.17%

Oil, Gas and Coal 8,363.14 +1.13%

Precious Metals and Mining 11,064.25 +0.66%

Bottom performing sectors so far today

Automobiles & Parts 1,842.81 -4.55%

Leisure Goods 23,545.00 -3.03%

Electronic & Electrical Equipment 10,169.82 -2.45%

Personal Goods 32,031.65 -2.33%

Aerospace and Defence 6,403.93 -2.23%


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