MARKET SNAPSHOT: U.S. Stocks Drop On Budget Stalemate

By Kate Gibson, MarketWatch

NEW YORK (MarketWatch) -- U.S. stocks fell on Wednesday, extending a two-session slide, with Wall Street sidelined by worry about the budget standoff in Washington.

"I wish I could be watching earnings and economic data, but the goofiness in Washington is pretty much taking all the air out of the room," said Paul Nolte, managing director at Dearborn Partners.

"There is very little grey area, and the problem is we won't know until we get there, so investors are placing their bets on both sides of the market at this point," Nolte added.

After fluctuating between small gains and losses, the Dow Jones Industrial Average (DJI) lost 15.93 points, or 0.1%, to 14,760.60.

The S&P 500 index (SPX) shed 3.13 points, or 0.2%, to 1,652.32, with energy leading losses among its 10 major sectors.

Alcoa Inc. (AA) rose 3.9%, a day after the aluminum producer reported better-than-anticipated quarterly earnings. (Read more on Alcoa results: http://blogs.marketwatch.com/thetell/2013/10/08/what-alcoas-results-say-about-global-manufacturing/.)

Shares of Jos. A. Bank Clothiers Inc. (JOSB) and Men's Wearhouse Inc. (MW) both rallied after Men's Wearhouse spurned the former's buyout offer.

The Nasdaq Composite (RIXF) declined 25.10 points, or 0.7%, to 3,669.78.

For every three stocks rising, more than four fell on the New York Stock Exchange, where 181 million shares traded as of 11 a.m. Eastern. Composite volume hit 990 million shares.

Treasury prices were mixed, with the yield on the 10-year note (10_YEAR) used in figuring mortgages and other consumer loans up 1 basis point at 2.648%.

The dollar (DXY) gained against the currencies of major U.S. trading partners and crude (CLX3) and gold (GCZ3) fell, with oil futures off nearly $2 at $101.78 a barrel and gold futures down $25 at $1,299.50 an ounce.

Janet Yellen, now vice chairwoman of the Federal Reserve, will be nominated to succeed Ben Bernanke as Fed chief, with an announcement expected to come from President Barack Obama in the afternoon.

At 2 p.m. Eastern time, the central bank will release minutes from its September meeting, at which the Fed unexpectedly refrained from tapering its $85 billion in monthly asset purchases.

The development comes as Democrats and Republicans on Capitol Hill continue to spar over the partial government shutdown and hiking the debt limit.

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