US markets slip as Obama warns no immediate end to shutdown

US MARKETS slipped yesterday as President Obama warned that there is no instant solution to the budget stand-off that has forced the US government into shutdown mode.

Obama said Republican opponents in Congress are making it impossible to discuss raising the country’s debt ceiling because they were demanding too many concessions, including a delay to his flagship healthcare reforms.

“We can’t make extortion routine as part of our democracy,” the President insisted last night.

Budget legislation means the US federal government can only carry $16.7 trillion (£10.38 trillion) of debt. It is due to cross this line next week, leading to fears that the US could default on its debt.

The Dow Jones Industrial Average and S&P 500 both fell by more than one per cent, with the losses expected to be reflected by the FTSE 100 when London trading opens this morning.