Stocks Opened Flat on Reported Sequester Plan

U.S. stocks struggled for direction at the open on Friday as Obama administration in advanced internal discussions on a plan to replace the sequester with a smaller package of spending cuts and tax increases. The Dow Jones Industrial Average lately fell 20.46 points, or 0.16%, to  12,521.92. The S&P 500 index was off 2.37 point to 1,350.96. The Nasdaq Composite fell 7.55 points to 2,829.39.

White House officials are said to be in advanced talks to replace the so-called sequester – a slew of spending cuts that along with tax increases will take place automatically at the end of the year and likely put the U.S. into recession – with a package of smaller, more targeted spending cuts and tax increases, according to a report in The Wall Street Journal.

The output of the nation’s factories, mines and utilities fell in October as Hurricane Sandy held down production in the Northeast, the Federal Reserve said Friday. Production fell 0.4% in October, the Fed said. The hurricane reduced total output by nearly 1%, the central bank estimated.

Major banks have announced some 160,000 job cuts since early last year and with more layoffs to come as the industry restructures, many will leave the shrinking sector for good as redundancies outpace new hires by roughly two-to-one.