Top 3 Reasons Markets Were Down on Debt Deal and a Weak Manufacturing Report

Markets closed down on Wall Street today: Dow -0.09%, S&P -0.41%, Nasdaq -0.43%, Oil -0.50%, Gold -0.57%.

On the commodities front, Oil (NYSE:USO) fell to $95.22. Precious metals also fell, with Gold (NYSE:GLD) down to $1,621.90 an ounce and Silver (NYSE:SLV) down 1.85% to $39.37 an ounce.

Don’t Miss: The U.S. Debt Deal: Your Cheat Sheet to the Framework.

Today’s markets were down because:

1) Debt ceiling. Last night President Obama announced that negotiators from both parties and both chambers of Congress had reached a compromise on a debt proposal. But as leaders try to sell the deal to their peers, it’s looking like it might be a close vote. The House is currently hearing from both the bill’s supporters and its opposition, which comes in the form of both liberal and conservative representatives. Polls showed that most Americans wanted a deal that placed some of the burden of balancing the budget on taxes, if only on the wealthy, rather than focusing solely on spending cuts as the deal does. All of that leads to a less than optimistic turnout at the markets despite what should have been a huge sigh of relief.

2) Manufacturing. While news of a likely debt ceiling solution might have given markets a boost in the absence of any truly negative data, we’ll never know, as the ISM Manufacturing Report released before the markets opened today showed that growth in the sector slowed to a snail’s pace in July, not just in the U.S. but globally.

3) Healthcare. Taking a huge beating today were healthcare stocks, down on fears that cuts to Medicare would reduce revenue for everything from drug companies like Pfizer (NYSE:PFE) to healthcare providers like Humana (NYSE:HUM). Healthcare stocks (NYSE:XLV) were down across the board, despite many positive earnings reports last week. Keep your eye on these top healthcare stocks as the debt deal unfolds: Johnson & Johnson (NYSE:JNJ), Pfizer Inc. (NYSE:PFE), Bristol Myers Squibb Co. (NYSE:BMY), GlaxoSmithKline plc (NYSE:GSK), Sanofi-Aventis SA (NYSE:SNY), Eli Lilly & Co. (NYSE:LLY), Abbott Laboratories (NYSE:ABT), Teva Pharmaceutical Industries Ltd (NASDAQ:TEVA), and Novartis AG (NYSE:NVS).

BONUS: Are Support and Resistance Levels in Precious Metals Holding?

More from The Cheat Sheet