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Washington In Focus By WSS Research Desk

|Includes:Alcoa, Inc. (AA), ONVO

By Carlos Guillen

Equity markets are back into losing territory after comments from House Speaker Boehner served to dampen the spirits of investors that last Friday had become hopeful of progress in reaching some form of agreement in Washington.

Trading activity last week was entirely dominated by the government shutdown as investors became increasingly concerned about its effects and how it will throw a wrench into the fragile gears of our economy. But there appeared to be a shining light at the end of the tunnel Friday as there was increasing word that the House of Representatives would find a way to reach some form of agreement on passing the fiscal budget, ending this crazy and needless U.S. Government shutdown. However, comments made over the weekend by House Speaker Boehner have brought uncertainty back into equity markets. The House Speaker made it very clear that that the House does not have the votes to pass a clean continuing resolution nor to pass a clean debt limit. Boehner said the House can't pass an increase to the U.S. debt ceiling without packaging it with other provisions. Worst of all, the House Speaker said he thinks the U.S. could end up in default if Obama doesn't negotiate.

On a bit of positive news, however, Moody's Investors Service said it sees a very low chance the U.S. will default on its debt payments. This is very encouraging given the current state of affairs in Washington, but we are not exactly sure what that low probability is; we must remember that a very low probability still means there is a probability.

As it stands, we are now into the second week of the U.S. government in shutdown mode, and despite some head-fakes of progress in Washington, it appears that we are now even further off from reaching a fix to this fiasco. The clock is ticking closer the October 17 deadline, which is when the U.S. government will hit default on its debt, and investors are increasingly concerned.

With no economic data presented today, equity markets remain at the mercy of news flow from Washington. As it stands the Dow Jones industrial Average is down over 80 points but holding stably. Alcoa AA will report earnings tomorrow after the close of trading, setting the stage for the start of earnings season. Later in the week, Wells Fargo and JPMorgan will also report earnings; the Street will be looking of phenomenal earnings from all three to counter the adverse events from Washington.

Need Some Skin? Just Print it out!
By David Urani

It's not a market moving event nor is it a stock you're likely to hear much about but my favorite news of the day today came from Organovo ONVO. You might not have known it, but people are 3D printing human organ tissue these days. That's right, a machine layers on living cells in a pre-programmed pattern, not unlike the way your inkjet at home prints out documents. It's not sci-fi, in fact it's Organovo's bread and butter. They've even found a way to print out vessel tissue into the actual branched tube shape of a blood vessel. It's still a development-stage company with an ultimate goal of printing out a full working liver or kidney for instance, but they're exploring other uses along the way. Their first validated commercial opportunity came earlier this year through liver tissue production for applications in drug development.

Today's announcement is an agreement with L'Oreal to explore 3D printed skin to test their skin care products. Imagine that, no need for animal testing or human guinea pigs, L'Oreal could be able to try out beauty products on living printed skin, not only to see if it's safe but to find out if the products work like they're supposed to.

Stocks: AA, ONVO