Stocks have pared early morning gains that were fueled by optimistic economic data showing that the U.S. economy grew faster than originally thought in the third quarter, strong pending home sales and initial jobless claims declining in the latest full week.
The bulls were also making a morning run following a strong Wednesday session as traders felt that Republicans and Democrats were putting aside differences in Washington to address the upcoming fiscal cliff, a $600 billion blend of tax increases and spending cuts set to occur with the New Year. President Obama had said on Wednesday that he felt confident that an agreement would be reached by Christmas, wending way for two consecutive down days for the Dow to be eliminated by upward market pressure.
The momentum lost its steam after House Speaker John Boehner said in a Thursday morning press conference that “no substantive progress” has been made to address the cliff in the past two weeks. Boehner added that the Democrats “have yet to get serious about spending cuts.”
Boehner delivered his speech after speaking with Treasury Secretary Timothy Geithner, saying that the Democrats have said that they will make concessions towards savings, but have yet to provide any recommendations for program cuts to date.
As much as the top Republican negotiator helped markets on Wednesday, he pulled the life out of them today. Shortly after Boehner’s comments, the Dow released 60 points to fall back to about even for the day.