US stocks erased early gains and turned intraday negative short after Monday's opening as the ISM report showed the US manufacturing activity slowed in July.
Stocks had opened with gains on optimism the US will avoid defaulting on its debt as a deal to raise the limit was reached between Democrats and Republicans. However, the US government could still lose its AAA credit rating.
The Dow Jones industrial average lost 82 points or 0.68% to 12,061. The Standard & Poor's 500 Index dropped 10 points or 0.82% to 1,281. The Nasdaq Composite Index fell 21 points or 0.77% to 2,735.
In the US the ISM manufacturing index came in lower-than-expected. The index decline from 55.3 to 50.9 in July. Analyst were expecting a smaller decline to 55.1.
