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Dow slides 200 points as traders await House vote on debt ceiling: Live updates

Traders on the floor of the NYSE

Source: NYSE

Stocks fell Wednesday as investors kept an eye on the federal debt ceiling debate in Washington in the final trading day of May.

The Dow Jones Industrial Average traded 228 points lower, or 0.7%. The S&P 500 dipped 0.6%, while the Nasdaq Composite pulled back by 0.3%.

President Joe Biden and House Speaker Kevin McCarthy announced a deal over the weekend to cap federal baseline spending for two years and raise the debt ceiling, but the agreement has not yet been ratified.

The deal cleared a major test Tuesday night after advancing to the House floor following a 7-6 vote in the House Rules Committee. The floor vote is expected to take place around 8:30 p.m. ET Wednesday.

“I think we have the votes to pass this today,” said Rep. Patrick McHenry, a GOP negotiator on the debt deal, on CNBC’s “Squawk Box” Wednesday morning.

With just Wednesday’s session left in the trading month, the Nasdaq Composite is up more than 6%. The S&P 500, however, is up only about 0.4%, while the Dow has fallen around 3.6%.

The outperformance of the tech-heavy Nasdaq is due in large part to the excitement around artificial intelligence, which briefly pushed Nvidia‘s market cap above $1 trillion on Tuesday. However, many on Wall Street are worried that the market’s strength has been too narrow.

“We’re not seeing any signs of broad participation. We’re not seeing signs of early cyclicals on top of A.I.,” said Andrew Smith, chief investment strategist at Delos Capital Advisors in Dallas.

Correction: Nvidia’s market cap briefly topped $1 trillion on Tuesday. A previous version misstated the date.

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