Debt drama darkens investors' mood

October 8, 2013: 7:22 AM ET
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NEW YORK (CNNMoney)

There's a cautious mood on Wall Street as investors consider Monday's s sell-off, which was led by heightened uncertainty over the U.S. debt ceiling and government shutdown.

U.S. stock futures were barely moving ahead of the opening bell.

Tuesday marks the eighth day of the government's partial shutdown. In that time, the Dow Jones industrial average has dropped 193 points.

Tuesday is also the start of third-quarter earnings season, with results due after the closing bell from aluminum producer Alcoa (AA), along with Yum! Brands (YUM), the parent of KFC, Pizza Hut and Taco Bell.

Related: 4 ways a debt ceiling crisis could affect you

But investors will likely remain focused on the debt drama playing out in Washington.

"Earnings, I expect they're going to take a backseat as the impasse overshadows," said Peter Cardillo, chief market economist at Rockwell Global Capital. "We're probably going to tread water as we get closer to the Oct. 17 date [a critical debt ceiling deadline]."

Related: Fear & Greed Index still mired in fear

U.S. stocks fell Monday on the continuing political standoff.

Despite heated posturing, many hope and expect the Democrats and Republicans will be able to reach a last-minute agreement to raise the debt ceiling and avoid a default.

European markets were all moving lower in morning trading, led by declines in London's FTSE 100, while Asian markets ended with gains. The Shanghai Composite index jumped by 1% after investors returned from a long holiday.

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