- Reuters/Christinne Muschi
Here is what you need to know.
Congress just reached the mother of all budget deals of the Trump era. The bipartisan deal, announced by Senate leaders on Wednesday, is expected to increase defense and domestic spending by just under $300 billion over two years as well as provide billions of additional dollars in disaster-relief funding. Congress must pass a funding bill by the end of Thursday to avoid a government shutdown.
One of the biggest narratives behind why the stock market just went haywire is wrong. The idea that this was a rate-induced sell-off is incorrect, because “we would have seen the interest rate-sensitive sectors underperform broader equity indices severely, which was not the case,” Pavilion Global Markets wrote.
The Chinese yuan hits its weakest level in 2 1/2 years. The People’s Bank of China set its midpoint versus the US dollar at 6.2822, the weakest for the yuan since August 2015.
Cryptocurrencies rise even though the World Bank president called them a Ponzi scheme. Bitcoin, Ethereum, and bitcoin cash are all up at least 11% even though the World Bank Group’s president, Jim Yong Kim, compared them to Ponzi schemes.
Tesla reports a smaller than expected loss, slows cash burn. The electric-car maker lost $3.04, topping expectations, and said it burned through $276.8 million of cash, down from a record $1.42 billion cash burn in the previous quarter.
Snap skyrockets 45% after earnings. “This is what happens to a stock when sentiment is overwhelmingly negative, expectations are super low, and the company shows what seems to be an inflection point,” RBC Capital Markets’ Mark Mahaney told Business Insider.
Samsung’s chairman is suspected of evading taxes. The South Korean police have accused Samsung Electronics’ chairman, Lee Kun-hee, of using bank accounts held in someone else’s name that held about 400 billion won ($368 million), Reuters says, citing the South Korean news agency Yonhap News.
Stock markets around the world trade mixed. Japan’s Nikkei (+1.13%) leads the gains in Asia, and Britain’s FTSE (-0.84%) trails in Europe. The S&P 500 is set to open lower by 0.62% near 2,665.
Earnings reporting remains heavy. CVS Health, Twitter, and Yum Brands report ahead of the opening bell, while Nvidia releases its quarterly results after markets close.
US economic data trickles out. Initial claims will be released at 8:30 a.m. ET. The US 10-year yield is unchanged at 2.83%.