NEW YORK, Oct. 3 (Xinhua) -- U.S. stocks pared earlier losses on Thursday but still fell across the board, as investors grew more worried about the budget stalemate in Washington.
The Dow Jones Industrial Average plunged 136.66 points, or 0.90 percent, to 14,996.48 points. The S&P 500 sank 15.21 points, or 0. 90 percent, to 1,678.66 points. The Nasdaq Composite Index plummeted 40.68 points, or 1.07 percent, to 3,774.34 points.
A partial U.S. government shutdown dragged into a third day on Thursday, after a White House meeting between U.S. President Barack Obama and congressional leaders on Wednesday afternoon ended with finger-pointing instead of compromise.
Obama said Wednesday that it is important for Wall Street to recognize that this is going to have a profound impact on the economy.
The first government shutdown in 17 years came after Congress failed to pass a spending bill by Monday's midnight deadline. Republicans in the House of Representatives are demanding changes to Obama's signature health care law in exchange for funding the government, which is refused.
The market eased off session lows on a report that House Speaker John Boehner said he is determined to prevent a federal default.
Economic data of the country came in mixed. The number of Americans who initially applied for jobless benefits last week rose 1,000 to 308,000 from the previous week, fewer than expected, the Labor Department said Thursday. The four-week moving average, a smoother measure, fell 3,750 to 305,000, the lowest level since May 2007, it added.
However, U.S. economic activity index in the non-manufacturing sector registered 54.4 in September, lower than the August reading of 58.6 percent, said the Institute for Supply Management.