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Stock market today: Live updates

Stock market today: Live updates

Investors Keep Close Watch on Debt-Ceiling Negotiations as U.S. Stock Futures Remain Flat

U.S. stock futures have remained mostly unchanged on Tuesday night as investors remain vigilant over the ongoing debt-ceiling negotiations. Futures linked to the Dow Jones Industrial Average rose by 29 points or 0.09%, while S&P 500 futures added 0.1%. Meanwhile, Nasdaq 100 futures registered a 0.12% gain.

The three major averages suffered declines during regular trading on Tuesday. The S&P 500 lost 1.12%, the Nasdaq Composite tumbled by 1.26%, while the Dow Jones Industrial Average declined by 0.69%. Analysts have suggested that this pattern may persist even if the debt ceiling is raised, as the Treasury will need to issue a lot of debt to replenish its general account, effectively removing liquidity from the broader capital markets.

Treasury Secretary Janet Yellen warned lawmakers earlier in May that a potential default in early June is “highly likely.” Following this, House Speaker Kevin McCarthy met with President Joe Biden on Monday, deeming the discussion “productive.” However, there remains little sign of progress in the negotiations.

Meanwhile, Federal Reserve’s meeting earlier in May was scrutinized by investors, who will eagerly await the release of Wednesday afternoon’s minutes. Additionally, earnings announcement from clothing retailer American Eagle Outfitters and semiconductor producer Nvidia will be posted after the bell on Wednesday.

FAQs

What is the debt ceiling?

The debt ceiling is the maximum amount of money that the United States government is permitted to borrow in order to finance its operations.

Why is the debt ceiling important?

When the government reaches its debt ceiling, it needs to either cut spending or raise taxes to prevent defaulting on its loans. A breach of the debt ceiling could have costly consequences for the economy, such as the downgrade of the country’s credit rating, an increase in the cost of borrowing, and market volatility.

What happens if the debt ceiling is not raised?

If the debt ceiling is not raised, the government will be unable to pay its bills, leading to a default. This could lead to severe economic consequences, including a recession, market turbulence, and higher borrowing costs for the government.

Stock market today: Live updates
Stock market today: Live updates

Updates on Today’s Stock Market Performance.

Investors kept a close watch on debt-ceiling negotiations as US stock futures remained largely unchanged on Tuesday evening. Futures tied to the Dow Jones Industrial Average marginally rose by 0.09%, gaining 29 points, S&P 500 futures added 0.1%, while Nasdaq 100 futures jumped 0.12%. The three primary averages declined during regular trading on Tuesday, with the S&P 500 losing 1.12%, while the Nasdaq Composite and the Dow Jones Industrial Average toppled by 1.26% and 0.69%, respectively. Treasury Secretary Janet Yellen had previously cautioned lawmakers that the possibility of default was “highly likely” in early June. House Speaker Kevin McCarthy had a positive exchange with President Joe Biden on Monday, yet no significant headway was made in negotiations on Tuesday. Even if Washington officials increase the debt ceiling, market turmoil is still a possibility, according to Bill Merz, head of capital markets research at US Bank Wealth Management. Merz claims that the impact on the broader capital markets is likely to remove liquidity, which would overlap with the S&P 500s general stock performance. Investors will be closely monitoring the minutes from the Federal Reserve’s May meeting, expected to be released Wednesday afternoon. Additionally, clothing retailer American Eagle Outfitters and semiconductor producer Nvidia are set to announce their results after the bell on Wednesday.

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