Stocks slide on debt gridlock

The US dollar fell broadly on Tuesday as US lawmakers remained deadlocked over raising the nation's debt ceiling to avoid a devastating default, while US and European shares also declined.

The Dow Jones industrial average ended down 91.50 points, or 0.73 percent, at 12,501.30. The Standard & Poor's 500 Index lost 5.49 points, or 0.41 percent, at 1,331.94. The Nasdaq Composite Index was down 2.84 points, or 0.10 percent, at 2,839.96.

European shares fell, dented by a slew of poor earnings news, contagion fears in the euro zone debt crisis after Spanish and Italian yields rose and worries about the debt stalemate in the United States.

The FTSEurofirst 300 index closed down 0.3 percent at 1,100.97 points, but the index recouped some of its earlier losses made after Italian yields rose following better-than-expected US consumer confidence in the afternoon.

The Nikkei stock average rose as robust quarterly earnings and higher profit forecasts from the likes of digital camera and copier maker Canon Inc helped offset a yen that has strengthened on US debt woes. The benchmark Nikkei rose 0.5 percent at 10,097.72