Wall Street drops on oil prices, shutdown fears

A pair of traders confer on the floor of the New York Stock Exchange. File Photo

U.S. stocks slid on Friday as negotiations continued to avert a government shutdown and rising oil prices weighed on transportation stocks.

Investors were wary of the effects of a possible US government shutdown if President Barack Obama and Congress are unable to agree to a new spending bill before midnight. Thousands of federal employees would be temporarily out of work and most government services would come to a halt, prompting Obama to warn it could threaten the already fragile economic recovery.

Airlines and shipping companies led the downturn as oil prices hit a 30-month high, rising above 112 dollars a barrel in New York.

The blue-chip Dow Jones Industrial Average lost 29.44 points, or 0.24 per cent, to 12,380.05. The broader Standard and Poor’s 500 Index shed 5.34 points, 0.4 per cent, to 1,328.17. The technology-heavy Nasdaq Composite Index fell 15.72 points, or 0.56 per cent, to 2,780.42.

For the week, the Dow closed down 0.03 per cent, the S&P dropped 0.32 per cent, and the Nasdaq slid 0.33 per cent.

The US currency slipped against the euro to 69.05 euro cents from 69.91 euro cents on Thursday. The dollar dipped against the Japanese currency to 84.76 yen from 85 yen.