Budget battle weighs on stocks

NEW YORK (CNNMoney)

The Dow Jones industrial average and S&P 500 slipped in early trading while the Nasdaq edged slightly higher.

Unless a compromise is reached during the next week, the government is poised to shut down at the start of October. While investors don't typically worry too much about a shutdown, the political wrangling and gridlock may cause some volatility in markets, according to experts.

"We suspect a budget showdown in Washington will likely weigh on global markets for the next several weeks," said Craig Johnson, senior technical research strategist at Piper Jaffray. But he added that any weakness in stocks would be a buying opportunity, as he doesn't believe either Democrats or Republicans would let the U.S. default on its debt.

The budget fight overshadowed positive global economic news, as new data from HSBC showing China's manufacturing sector expanded at the fastest pace in six months.

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What's moving: Apple (AAPL, Fortune 500) shares jumped after the company said it sold a record 9 million iPhone 5S and iPhone 5C devices worldwide during the first three days the phone went on sale.

BlackBerry (BBRY) shares continued to decline after the company announced last week that it is slashing 40% of its workforce and warned of a $1 billion quarterly loss.

Related: Government shutdown, Fed timing looms large

European markets were lower in morning trading, with stocks losing their earlier momentum. Eurozone purchasing managers had reported slightly stronger-than-expected growth in manufacturing and services.

German chancellor Angela Merkel's big victory in Sunday's elections also helped early sentiment as voters backed her handling of the euro zone crisis and Europe's biggest economy. Frankfurt's DAX index, which has gained 14% so far this year, slipped 0.3%.

Asian markets ended mixed. The Shanghai Composite index rose by 1.3%. Meanwhile, Hong Kong's market was closed in the morning because of Typhoon Usagi. But trading resumed in the afternoon and the Hang Seng index dropped by 0.6%. The Tokyo Stock Exchange was closed for a holiday.

First Published: September 23, 2013: 9:47 AM ET

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