Stocks sink as debt limit remains unresolved

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NEW YORK (AP) — The debt showdown in Washington is rattling the stock market once again.

Stocks fell Monday after congressional leaders failed to agree on a deal to raise the nation’s debt limit and avoid default. Lawmakers hoped to reach a compromise late Sunday, but those talks stalled. If an agreement is not reached by Aug. 2, the U.S. won’t have enough cash to pay all its bills. That could have a catastrophic impact on financial markets.

At midday, the Dow Jones industrial average is down 50 points, or 0.4 percent, at 12,631. The Dow had been down as many as 145 points shortly after the opening of trading.

The Standard & Poor’s 500 is down 4, or 0.3 percent, at 1,341. The Nasdaq composite is down 7, or 0.3 percent, at 2,852.