A political stalemate in Washington over the debt ceiling weighed on risk appetite on Monday morning, with the FTSE 100 holding steady in early trading after hitting two-week highs the previous session.London's benchmark index finished at 6,483.79 on Friday, its highest close since September 27th, rebounding strongly following a choppy week as markets reacted to ongoing developments on Capitol Hill.This weekend's negotiations between US lawmakers failed to conclude in a agreement to raise the debt ceiling ahead of the October 17th deadline as Republicans and Democrats remain divided over a number of issues."With three days to go before the US Treasury technically runs out of cash to pay the bills, traders are now fearing the worst-case default scenario being played out. Although many dismiss it as unlikely with hopes that US lawmakers will strike an 11th hour deal, traders are showing reluctance to take risk as we head into the deadline," said Market Strategist Ishaq Siddiqi from ETX Capital.Meanwhile, Siddiqi pointed out that the US government has now had two full weeks in shutdown mode, which will surely eat away at economic growth in the fourth quarter."At a time when the economic recovery in the states is fragile, an erosion of economic growth is highly undesirable - the silver lining however is that the Federal Reserve will not taper asset purchases with this in the backdrop."FTSE 100: Ratings changes move stocks early onChemicals group Johnson Matthey was performing well this morning after the stock was upgraded by JPMorgan Cazenove from 'neutral' to 'overweight'. The US bank hiked its target price for the shares from 2,800p to 4,000p, saying that it sees "major potential from a swathe of new global industrial capex".The same bank however was weighing on the share price of sector peer Croda after it downgraded its rating from 'overweight' to 'neutral', saying that expectations for the third quarter "look demanding".Several other blue-chip stocks were hit with downgrades this morning, including SABMiller (Citigroup cut to 'neutral'), Bunzl (JPMorgan lowered to 'neutral') and Glencore Xstrata (Liberum Capital cut to 'hold'). Building materials firm Travis Perkins however was lifted to 'buy' by Bank of America.RBS was trading lower after Bank of America Merrill Lynch downgraded the stock to 'underperform'. Banking peers Lloyds and Barclays were also in the red. Lloyds frontman António Horta-Osório was quoted by the Financial Times as saying that the government's 'Help to Buy' scheme could risk creating a housing bubble if steps to build new housing are not taken.FTSE 250: Michael Page slumps on mixed Q3Recruitment group Michael Page International fell sharply this morning after a mixed third quarter, as improved performances in the UK and US were counterbalanced by flat sales in Europe and declines in Asia Pacific. Gross profit increased by just 0.4% year-on-year at constant currency.Plastic packaging company Essentra was heading the other way after saying it is on track to deliver profit growth this year on the back of a strong third quarter.Elsewhere, Royal Mail continued to rise this morning, extending gains after Friday's stock-market debut led to a 38% surge in the share price. The successful initial public offering has fuelled the debate over whether the shares were underpriced by the government.FTSE 100 - RisersJohnson Matthey (JMAT) 2,948.00p +4.50%Travis Perkins (TPK) 1,746.00p +4.05%Severn Trent (SVT) 1,805.00p +1.06%Associated British Foods (ABF) 1,931.00p +1.05%National Grid (NG.) 755.50p +1.00%Smith & Nephew (SN.) 779.00p +0.97%Vedanta Resources (VED) 1,029.00p +0.88%Vodafone Group (VOD) 221.60p +0.82%Antofagasta (ANTO) 866.00p +0.81%BG Group (BG.) 1,200.00p +0.80%FTSE 100 - FallersRoyal Bank of Scotland Group (RBS) 369.90p -1.86%Bunzl (BNZL) 1,313.00p -1.57%Croda International (CRDA) 2,439.00p -1.53%SABMiller (SAB) 2,978.00p -1.19%Diageo (DGE) 1,956.50p -0.84%Lloyds Banking Group (LLOY) 75.39p -0.83%Standard Life (SL.) 352.70p -0.79%GKN (GKN) 359.50p -0.77%Centrica (CNA) 360.50p -0.77%IMI (IMI) 1,478.00p -0.67%FTSE 250 - RisersEssentra (ESNT) 743.50p +2.48%Diploma (DPLM) 629.50p +2.36%Balfour Beatty (BBY) 273.10p +1.71%Carillion (CLLN) 308.70p +1.71%Moneysupermarket.com Group (MONY) 144.80p +1.69%Dialight (DIA) 1,205.00p +1.69%Bellway (BWY) 1,377.00p +1.62%Bankers Inv Trust (BNKR) 569.00p +1.61%Cable & Wireless Communications (CWC) 41.40p +1.42%Cobham (COB) 284.00p +1.32%FTSE 250 - FallersMichael Page International (MPI) 460.00p -6.98%Chemring Group (CHG) 215.70p -1.95%Hays (HAS) 119.60p -1.64%Alent (ALNT) 333.00p -1.54%Interserve (IRV) 577.00p -1.54%Ladbrokes (LAD) 187.80p -1.52%Xaar (XAR) 783.50p -1.51%Telecity Group (TCY) 791.50p -1.49%Soco International (SIA) 402.00p -1.16%Genus (GNS) 1,329.00p -1.04%BC