US STOCKS-Wall St drops on Trump's threats of govt shutdown

U.S. stocks were lower late on Wednesday morning after President Donald Trump's warning of a government shutdown to secure funds to build the Mexico border wall added to nerves as the deadline to the raise the U.S. debt ceiling looms.

Lawmakers face a late-September deadline to raise the debt ceiling or risk a default, and Trump's comments on Tuesday evening came hours after a lawmaker said there was "zero chance" of the ceiling not being raised.

Fitch Ratings said on Wednesday a failure by U.S. officials to raise the ceiling in a timely manner would prompt it to review its rating on U.S. sovereign debt, "with potentially negative implications."

"Trump saying he would be willing to shut down the government over the wall obviously doesn't really inspire much confidence in anyone," said Michael O'Rourke, chief market strategist at JonesTrading in Greenwich, Connecticut.

"The debt limit, which is truly urgent and something that needs to be addressed, where theoretically failure should not be an option, that is something of a litmus test for the market."

Investors have grown increasingly concerned about the Trump's ability to legislate his pro-growth agenda given the near constant political rumblings in the White House.

At 11:01 a.m. ET (1501 GMT), the Dow Jones Industrial Average was down 58.78 points, or 0.27 percent, at 21,841.11 and the S&P 500 was down 6.83 points, or 0.28 percent, at 2,445.68.

The Nasdaq Composite was down 21.91 points, or 0.35 percent, at 6,275.56.

The CBOE Volatility index, a widely followed measure of market anxiety, rose 0.55 points to 11.90, marking its first increase in four days.

Investors are also jittery ahead of Federal Reserve Chair Janet Yellen's speech in Jackson Hole, Wyoming, on Friday, which will be scrutinized for clues on the central bank's stand on monetary policy.

Also weighing on sentiment was data that showed new U.S. single-family home sales unexpectedly fell in July to a seven-month low.

Six of the 11 major S&P indexes were lower, with consumer discretionary index's 0.75 percent fall leading the decliners.

Lowe's 5.5 percent fall weighed the most on the S&P after the company reported a lower-than-expected profit and cut its margins forecast.

Bigger rival Home Depot dropped 2.28 percent, weighing the most on the Dow.

Shares of advertising firm Omnicom dropped nearly 4.5 percent, while Interpublic Group fell 3.7 percent after WPP cut its sales forecast. WPP'S U.S.-listed shares sank about 12 percent.

Advancing issues outnumbered decliners on the NYSE by 1,431 to 1,251. On the Nasdaq, 1,477 issues fell and 1,156 advanced.

(This article has not been edited by DNA's editorial team and is auto-generated from an agency feed.)