At the Open: Stocks Fall on Shutdown Concerns; JPMorgan Gains on Settlement Efforts

Can we make it five days in a row?

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The S&P 500 has dropped 0.3% to 1,692.45, while the Dow Jones Industrials have fallen 0.2% to 15,302.52, and appear headed for a fifth day of losses.

All eyes appear to be on Congress, as the the government appears headed for a showdown over the budget and the debt ceiling. Jefferies’ Ward McCarthy says that the “drop-dead date” may be less than one month away:

Based on our current cash balance projections and our estimate of the remaining "extraordinary measures", we expect that Treasury will run out cash by October 23rd. It's possible that they may be able to squeeze in a cash management bill to fund a Social Security benefits payment that day, but if they do, then Treasury will not weeks, depending on the strength or weakness of Treasury cash flows. However, it is not likely to change too much.

There was nothing in this morning’s durable-goods report to snap stocks out of today’s malaise–they rose just 0.1%, although that was enough to beat economist forecasts for no increase. Miller Tabak’s Andrew Wilkinson explains why the numbers didn’t excite investors:

The headline reading rose by 0.1% boosted by a gain of 0.7% for the heavyweight transport sector. Machinery and the all other category advanced by 0.9% while fabricated metals saw increased orders of 0.3%. Primary metals and electrical orders fell by 0.5% while computer and electronic order books slumped by 3.4%. The report argues in favor of the FOMC's recent decision to await further data points that might indicate sustainability of demand. While the report was not weak overall, it does not point to acceleration of activity at this stage.

Maybe a market that’s down just a bit should be considered good news.

Stryker (SYK) has dropped 1.9% to $69.52 after it said it would purchase Mako Surgical (MAKO) for $30 a share.

J.C. Penney (JCP) has dropped 8.8% to $10.52, its lowest price in 12 years, continuing its recent selloff.

JPMorgan Chase (JPM) has gained 1.5% to $51.05 on reports that it’s trying to reach a $3 billion settlement with the government.

Baxter International (BAX) has dropped 4.8% to $67.83, as JPMorgan initiated coverage with a Neutral.