Morning Brief: Congress approves budget, ends brief gov’t shutdown
Friday, February 9, 2018
What to watch today
All eyes are on the stock market, as prices make wild swings as they go lower. Thursday saw the Dow Jones Industrial Average drop more than 1,000 points for the second time in four days while each of the major U.S. indexes lost more than 3.7% for the day. The Dow’s 4.15% decline — which was good for a 1,032-point loss — led markets lower. The benchmark S&P 500 lost 100 points, or 3.75%, while the tech heavy Nasdaq lost 274 points, or 3.9%. Bespoke Investment Group notes that both the Dow and the S&P 500 are officially in correction territory, defined as a 10% drop from recent highs, as the Dow settled at 23,860.46 and the S&P 500 closed at 2,581. The Nasdaq, which closed at 6,777.16, closed about 20 points above its correction level.
On Friday, the economic calendar remains largely blank with the December reading on wholesale inventories the only report of note, though this week has been devoid of market-moving economic data. The earnings flow will also slow down, with Moody’s (MCO) and the Cboe (CBOE) both reporting results, though the Cboe’s results will be closely watched by investors as shares of that company have lost about 15% this week on investor concerns that trading in VIX-related futures and options could decline given this week’s events.
Top news
Congress approves bill ending brief gov’t shutdown: The U.S. House of Representatives early on Friday approved a bill to fund the federal government through March 23 and to increase overall spending limits over two years, sending the legislation to President Donald Trump. [Reuters]
Twitter surprises with revenue turnaround: Twitter Inc. (TWTR) on Thursday delivered its first quarterly profit and an unexpected return to revenue growth helped by expansion outside the United States, pushing shares in the social network to more than two-year highs. Overall revenue rose 2% in the fourth quarter from a year earlier, handily beating analyst estimates that called for a fourth straight quarter of declines. [Reuters]
Qualcomm rejects Broadcom’s revised buyout offer: U.S. semiconductor company Qualcomm Inc. (QCOM) rejected Broadcom Ltd’s revised $121 billion buyout offer, but proposed meeting its peer to see whether they can address what it called the bid’s “serious deficiencies in value and certainty.” [Reuters]
Icahn target SandRidge drops CEO, CFO under activist pressure: Activist investor Carl Icahn just got another win in his crusade against SandRidge Energy Inc.’s (SD) top management. The Oklahoma City-based shale driller replaced CEO James Bennett as well as CFO Julian Bott on Thursday and announced drastic cuts to its drilling budget and corporate overhead. [Bloomberg]
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