Morning Brief: Supreme Court allows Trump travel ban to be enforced
Tuesday, December 5, 2017
What to watch today
All eyes will be on the stock market. Monday was disappointing, particularly for President Donald Trump who had predicted that it would be a “big day” for the stock market thanks to the GOP’s progress in advancing corporation-friendly tax reform. The S&P 500 (^GSPC) closed down by about 0.1% on the day.
The recent outperformance of the stocks of highly-taxed companies like the banks relative to the stocks of low-taxed companies like the tech giants has been notably stark. According to Bespoke Investment Group, the tech-heavy Nasdaq hasn’t underperformed the S&P 500 (^IXIC) over a five day period since May 2009, just two months after the bull market began.
On the economic front, we’ll get an update on the U.S. services sector at 10 a.m. ET. The ISM services index is estimated to have slipped to 59.0 in November from 60.1 in October. Any number above 50 signals growth.
Top news
Supreme Court allows Trump to enforce travel ban: It’s not a final ruling, but the Supreme Court is letting the Trump administration fully enforce a ban on travel to the United States by residents of six mostly Muslim countries. Challenges to the policy are winding through the federal courts, and the justices themselves ultimately are expected to rule on whether the ban is legal. [AP]
House, Senate GOP face challenge over corporate AMT tax: U.S. Republicans in Congress are working to reconcile competing tax bills from the Senate and House of Representatives into a unified measure that they hope President Donald Trump will sign into law before the end of the year. The Senate bill jettisoned a long-held Republican goal of repealing the corporate alternative minimum tax (AMT) to help pay for last-minute deals that secured the Republican votes for passage. That puts Senate Republicans on a collision course with Republicans in the House, whose own tax bill repeals the corporate AMT. [Reuters]
Deutsche Bank receives subpoena from Mueller on Trump accounts: Special Counsel Robert Mueller has asked Deutsche Bank to share data on accounts held by President Donald Trump and his family, a person close to the matter said. Germany’s largest bank received a subpoena from Mueller several weeks ago, confirming a report by German daily Handelsblatt published on Tuesday. [Reuters]
Goldman lifts 2018 oil price outlook: The Organization of Petroleum Exporting Countries (OPEC) and its allies’ strong commitment to extended oil supply cuts will lower inventories next year and lift prices, according to Goldman Sachs Group Inc. [Bloomberg]
Cineworld to buy Regal Entertainment for $3.6B: Britain’s Cineworld Group Plc (CINE) has agreed to buy U.S. movie theatre operator Regal Entertainment Group (RGC) for $3.6 billion in cash, the companies said on Tuesday. A deal would put the combined company in a better position to take on U.S. industry leader AMC Entertainment Holdings Inc. (AMC), and also give it more scale to fight growing competition from Netflix Inc. (NFLX), Apple Inc. (AAPL) and other digital outlets. [Reuters]
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