Wednesday, July 27, 2011

Wall Street set to open lower on debt deadlock

Angela Moon

U.S. stocks were set for a third straight day of declines as the political deadlock over raising the debt ceiling and a decline in durable goods orders kept investors away.A Republican plan to cut the U.S. deficit met stiff opposition, reducing the chances of a late compromise to avoid a crippling debt default.Even if there is no default, the government could face a downgrade in its triple-A rating, which would raise borrowing costs and deal a blow to the economic recovery.Credit Suisse strategists see a 50 percent chance of a credit rating downgrade on U.S. debt, even if the ceiling is raised as key decisions on fiscal tightening are delayed until after the 2012 U.S. elections.Further pressuring market sentiment, new orders for long-lasting U.S. manufactured goods fell . . . . . . .

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