Stocks slip as investors fear US debt default THE Australian share market has closed lower as investors become increasingly concerned that the budget impasse in the United States may lead to the US defaulting on its debts. The benchmark S&P/ASX200 index fell 26.9 points, or 0.51 per cent, to 5208 points, while the broader All Ordinaries index fell 26.1 points, or 0.5 per cent, to 5205.9 points. CMC Markets chief market strategist Michael McCarthy said the US government shutdown arising from the budget impasse was not as worrying as the growing possibility of the US defaulting on its debt on October 17. The original view was this would be resolved pretty quickly. The shutting down of the US government was largely symbolic," Mr McCarthy said. The longer it drags on, the bigger the concerns become. While a partial shutdown of the US government is not a disaster for global markets, a US debt default would be. There was a lack of commitment by investors on the local market today, reflected by "horrible" volumes of shares traded, Mr McCarthy said. But on the positive side, the main indices managed to stay above 5200 points. Upcoming financial reports from some of Australia's big banks and quarterly earnings reports from the US could shift the focus of investors away from macro-economic issues, Mr McCarthy said. BHP Billiton dropped 47 cents to $35.13 and Rio Tinto shed 31 cents to $60.47. Oil Search was six cents poorer at $8.39 after the Exxon Mobil-operated Papua New Guinea liquefied natural gas (PNG LNG) project took on another $US1.5 billion ($A1.6 billion) of debt to cover last November's cost blow-out. Among the major banks, ANZ dropped 20 cents to $30.76, Commonwealth Bank added six cents to $71.76, Westpac reversed 22 cents to $32.42 and National Australia Bank gave away eight cents to $34.81. Construction giant Leighton continued to drop, losing 80 cents, or 4.56 per cent, to $16.74, following media reports that alleged corruption was widespread in the company's international operations several years ago. The December share price index futures contract was 30 points lower at 5200 points, with 18,441 contracts traded. National turnover was 1.2 billion securities worth $2.8 billion.