US stocks drop as China's economy continues to weaken while the US debt ceiling deal heads for House vote

• US stocks fell Wednesday as Chinese manufacturing data showed further weakness.
• China's services sector also cooled off, further deflating hopes of a rebound.

The final trading day of the month kicked off in the red, with weak economic data coming out of China and investors still keeping eyes on Washington for updates on a potential conclusion to the debt-ceiling drama.

Chinese factory activity contracted at a faster pace in May, and service-sector growth cooled off, dashing hopes for a stronger rebound in the world's second largest economy. China's sluggish emergence from COVID-19 lockdowns has showed up across all parts of its economy, including obscure commodities markets.

Meanwhile, the debt ceiling deal that President Joe Biden and House Speaker Kevin McCarthy reached over the weekend will head to a vote on the House floor Wednesday evening.

This month, the S&P 500 is up about 0.9%, while the Nasdaq Composite has added 6.5% and the Dow has declined more than 3%.

Here's where US indexes stood as the market opened at 9:30 a.m. on Wednesday:

• S&P 500: 4,190.19, down 0.36%

• Dow Jones Industrial Average: 32,914.27, down 0.39% (128.51 points)

• Nasdaq Composite: 12,979.61, down 0.29%

Here's what else is going on:

• Restarting student loan payments will squeeze some consumers already feeling the pinch, Moody's said.
• Cathie Wood says Elon Musk's Tesla could emerge as a winner in the AI boom.
• Billionaire Ray Dalio gave the US debt deal a "D" grade.
• JPMorgan CEO Jamie Dimon warned that higher interest rates are coming.
• The stock market's resilience could spur the Fed to keep raising rates for longer, according to Ed Yardeni.

In commodities, bonds, and crypto:

• Oil prices slipped, with West Texas Intermediate down 2.53% to $67.04 a barrel. Brent crude, the international benchmark, fell 2.04% to $72.04 a barrel
• Gold edged 0.22% higher to $1,962.10 per ounce.
• The 10-year yield ticked down 2 basis points to 3.675%.
• Bitcoin declined 2.29% to $27,179.08.