Massive rout spells trouble for Wall St

THE Standard & Poor’s 500 index turned negative for the year yesterday as wrangling over the US debt ceiling faded and investors turned again to the stalling economy.

The broad-based index fell for a seventh day and crashed through the key 200-day moving average in the longest losing streak since October 2008.

Investors found little to cheer after the US Senate agreed to a deal to raise the debt ceiling because of the possibility it will not stave off a downgrade of the government’s triple-A rating.

The Dow Jones industrial average dropped 2.19 per cent, to 11,866.62. The S&P 500 dropped 2.56 per cent, to 1,254.05. The Nasdaq Composite Index dropped 2.75 per cent, to 2,669.24.