Stocks Slide as 'Fiscal Cliff' Pessimism Mounts
NEW YORK ( TheStreet) -- Major U.S. stock averages slid Thursday as more signs of discord in Washington over the "fiscal cliff" talks overshadowed a handful of better-than-expected economic releases.
House Speaker John Boehner, speaking on live television, once again broadcast the criticism among Republicans of President Barack Obama's most recent budget plans as anything but balanced.
He is "far more focused on tax hikes than spending cuts," said Boehner, who added the president is "just not serious" about cutting spending.
"Spending is the problem
The house speaker warned that the economy is at risk of being walked "right up to a fiscal cliff," potentially putting the job market in jeopardy.
The Dow Jones Industrial Average fell 75 points, or 0.56%, to 13,171. The blue-chip index began the session up about 8.5% in 2012.
Google's Maps app is again available on Apple's iPhone. The online mapping system returned late Wednesday, nearly three months after Apple replaced Google Maps with its own navigation tool but with disastrous results.
Volumes totaled 3.32 billion shares on the Big Board and 1.83 billion on the Nasdaq. Decliners were edging advancers by nearly a 2.3-to-1 ratio on the New York Stock Exchange and about 1.7-to-1 on the Nasdaq.
The large majority of sectors in the broader market were in the red, weighed down most heavily by energy, consumer cyclicals, health care and utilities. Only the transportation sector was in the green.
Averting the cliff before Christmas will likely help the S&P 500 to rally to 1,500 by year-end or early January, provided that the 2013 fiscal drag does not exceed 1.5% of gross domestic product, according to David Bianco, U.S. equity strategist at Deutsche Bank.
"However, further upside will be sensitive to the legislation's details," he noted. Bianco said that if top income tax bracket rate hikes were to be curbed from what's scheduled, the S&P 500 could reach 1,550 by the end of 2013, and if the new top dividend tax rate was at 25% or less, the benchmark index could reach 1,600 by then.
"The lesser the tax hikes, the more tolerant investors are likely to be of any weak macro data in early 2013," Bianco said.