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All eyes on the debt default deadline

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Published on: Monday, August 01, 2011

Ahead of tomorrow’s deadline, the US and Australian economy is on tenterhooks waiting for a decision on the US debt ceiling to be made.

US stocks closed lower over the weekend.

The Dow fell 96.9 points, or 0.79 per cent, to 12,143.2.

The Nasdaq was 9.9 points, or 0.36 per cent, lower to 2756.4.

The S&P 500 dropped 8.4 points, or 0.65 per cent, to 1292.3.

In news, US Senate majority leader Harry Reid is in support of a debt-ceiling agreement and has signed off his approval, pending the wider support of Senate Democrats. A vote on the package is expected today (AEST).

The package will allow enough borrowing to prevent the US defaulting on its debt, while also committing to trillions of dollars in spending cuts.

In Australia on Friday, the S&P/ASX 200 fell 39.2 points, or 0.88 per cent, to 4424.6 and the All Ords was down 38.7 points, or 0.85 per cent, to 4500.5.

Oil this morning was at US$95.70 per barrel and gold was at US$1627.88 per ounce. The Australian dollar was buying 110.13 US cents, 67.11 pence Sterling, 76.68 euro cents and 85.12 Japanese yen.


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