This isn’t quite a “TARP vote” level of panic, but for the first time it felt today like the debt ceiling fight really began rattling financial markets.

But first, the scoreboard:

Dow: 187.85
NASDAQ: -72.31
S&P 500: -25.74

And now, the top stories:

  • Obviously, story #1 is the debt ceiling, and there’s far too much to recap here, but here’s the key thing: The “Boehner Plan” — which would hike the debt ceiling in two stages — is gathering momentum in the house. The vote is tomorrow, and it’s not a done deal yet, but yesterday it was in disarray. Of course, Senate Dems and The White House are still fiercely against the bill. Click here to see who really owns American debt >
  • One other interesting bit of debt ceiling news: Jay Carney in a press briefing basically admitted that the Treasury can do payment prioritization after August 2.
  • As noted above, today was the day that markets started freaking out about the debt ceiling. If it were just a matter of stocks falling, that would be one thing, but there are clear signs that the short-end of the yield curve is starting to take notice in a bad way. Yields are still ultra-low, but they’re not 0% either. That’s notable. People are looking for other vehicles for their cash. Gold started out really hot, but faded.
  • In addition to the debt ceiling fiasco, there was also just general bad news, which in a more normal period would have gotten a lot of attention. The durable goods number stunk. Also, the Beige Book came out, confirming slowing growth in 8 out of 12 Fed districts.
  • Meanwhile, rewinding back a bit, things are once again getting hairy in Europe. Italy got slaughtered again today. Again, that would be a much bigger story if it weren’t for the debt ceiling drama.
  • For some ideas, check out the companies that will get killed in government austerity >

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