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October 03, 2013 03:23 PM

Friday Afternoon Business Brief

The government shutdown is in its third day with no end in sight, and that's weighing on stocks again. The Dow had dropped more than 180 points by midday, sinking below 15,000. It's regained much of that ground in afternoon trading, but remains about 100 points lower. The broader indexes have been following a similar path.

  • Warnings about the consequences of Congress failing to raise the government's borrowing limit are growing more urgent. The Treasury Department says a resulting default could cause credit markets to freeze and interest rates to skyrocket, and plunge the economy into a recession worse than the one from which the country is still recovering.  IMF chief Christine Lagarde adds that the consequences would be severe not only for the U.S. economy, but the global economy as well.
  • The government shutdown is making tomorrow look a lot less interesting for economic data. The Labor Department says it will not release its September jobs report and no alternative release date has been set. A FactSet survey finds economists are forecasting the economy added 180,000 jobs last month, with the unemployment rate holding at 7.3 percent. Meanwhile, the Labor Department did report a small increase in the number of people filing unemployment claims last week, but the total remains near a six-year low.
  • Tesla shares are down sharply again today after a fire involving one of its electric cars. A company spokeswoman says the fire began in the car's battery, after the driver hit metal debris. Firefighters wrote in an incident report that they had trouble extinguishing the flames and had to use a dry chemical extinguisher when water seemed to make the fire worse.  The incident near Seattle has prompted at least one stock analyst to downgrade Tesla.
  • Digital music service Rdio is launching its free Internet radio service in the U.S., Canada and Australia today. The company hopes nonpaying listeners will sign up for a $10-a-month subscription that adds features like the ability to pick and choose exact songs and albums. The move capitalizes on Rdio's tie-up with traditional radio station owner Cumulus Media and helps it compete with digital rivals Pandora and Spotify.
  • Business
  • Economy/Stocks

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