U.S. stocks shunned as debt ceiling concerns linger | WPN World People News

U.S. treasuries were higher on Friday as yields on 10-year bonds fell to their lowest level in 8 months.

The Japanese yen and Swiss franc, considered safe haven countries in times of grave uncertainty, both soared.

The continuing indecision by the country's leadership has now fueled concerns about the ongoing health of the economy, boosting treasuries.

Gold rallied well above $1,600 an ounce, to an all-time high, while the dollar dived.

Most analysts are now convinced the United States will lose its AAA-credit rating as rating agencies mark down the political stability of the country, and the capacity of its leadership which has been found wanting throughout the crisis.

While most investors believe a compromise will be reached on the debt ceiling, there was little sign of a consensus Friday, just days away from the August 2 deadline.

Republicans battled to get a bill supported by their own party - a bill that Democrats say they will not vote for. The resolution provides for a six month extension which would have lawmakers back debating the same issues they are now in six months - with the 2012 elections looming.

At the close of trading Friday the Dow Jones Industrial Average was down 96.87 points or 0.79% at 12,143.24.

“The markets are having a hard time discounting the possibility that politicians truly are insane,” Bruce McCain, who helps oversee $22 billion as chief investment strategist at the private-banking unit of KeyCorp in Cleveland, told the Bloomberg newsagency Friday. “One way or another they will do some patchwork solution that kicks the can down the road on the debt ceiling. We’ll be in a wait-and-see mode.”

The Nasdaq Composite was off 9.87 points or 0.36% at 2,756.38.

The Standard and Poor's 500 lost 8.39 points or 0.65% at 1,292.28.

The yen and Swiss franc made solid gains on Friday, ending the trading day in New York around 76.95 and 0.7876 respectively.

The British pound rose to 1.6412. The euro edged up to 1.4374.

The Australian dollar was little changed at 1.0989, whereas its counterpart, the New Zealand dollar, rallied to 0.8788.

The Canadian dollar was stronger at 0.9554.

Source: Central America News.Net