Wall Street sentiment was mixed overnight as Democrats and Republicans each flexed their muscles, both resisting giving in further to the other side's demands as the year-end deadline to avoid the fiscal cliff approaches rapidly.
US President Barack Obama would veto a tax and spending plan presented by House Speaker John Boehner, but said he remained hopeful of an accord by Christmas. The Republican "Plan B" would extend low tax rates for those who earn less than US$1 million-Obama has shifted to a US$400,000 threshold after starting out at US$250,000.
Republicans in the House could vote tomorrow on their "Plan B". The vote is being seen as a way to bolster Boehner's bargaining position within his own party.
In afternoon trading in New York, the Dow Jones Industrial Average slipped 0.07 per cent, the Standard & Poor's 500 Index fell 0.13. The Nasdaq Composite Index eked out a 0.09 per cent gain.
"Markets continue to be very much focused on fiscal cliff resolution," Ryan Larson, the Chicago-based head of US equity trading at RBC Global Asset Management (US), told Bloomberg News. "The move over the last few days has been supported by optimism that a deal will be reached by year-end. However, so far today we're seeing a bit of caution as Congressional leaders remain at different ends on several key issues."
