Wall Street Week Ahead-Investors eye US jobs data as stocks hit record highs
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Investors who have been captivated by recent geopolitical events are poised to shift their attention in the coming week to key economic data and policy developments to see if the torrid rally in U.S. stocks extends higher.The benchmark S&P 500 and Nasdaq Composite both tallied record highs on Friday for the first time in months, helped by optimism about interest-rate cuts and trade deals . Easing tensions in the Middle East also paved the way for the latest bump higher in stocks, as a conflict between Israel and Iran appeared to calm after missile strikes between the two nations had set the world on edge.Focus will shift to Washington in the coming week. President Donald Trump wants his fellow Republicans to pass a sweeping tax-cut and spending bill by July 4.Investors also get a crucial view into the U.S. economy with the monthly employment report due on Thursday. U.S. stock markets are closed on Friday, July 4, for the U.S. Independence Day holiday.Citigroup's U.S. economic surprise index has been weakening, indicating that data has been missing Wall Street expectations, said Matthew Miskin, co-chief investment strategist at Manulife John Hancock Investments."After some softer May data, the June data is really going to be under a microscope," Miskin said. "If the data deteriorates more, it may get the market's attention."U.S. employment is expected to have climbed by 110,000 jobs in June, according to a Reuters poll -- a slowdown from May's 139,000 increase.Data on Thursday showed the number of Americans filing new applications for jobless benefits fell in the prior week, but the unemployment rate could rise in June as more laid-off people struggle to find work."The labor market right now is front and center over the next few weeks," said Brent Schutte, chief investment officer at Northwestern Mutual Wealth Management.Employment data could factor into expectations for when the Federal Reserve will next cut interest rates, with investors also watching to see if inflation is calming enough to allow for lower rates.Fed Chair Jerome Powell has been wary that higher tariffs could begin raising inflation, a view he told the U.S. Congress this week. Some Fed officials have talked about a stronger case for cuts. Trading of fed funds futures in the past week indicated ramped-up bets for more easing this year.The level of tariffs could come into sharper view with a July 9 deadline for higher levies on a broad set of countries. U.S. Treasury Secretary Scott Bessent on Friday said trade deals with other countries could be done by the Sept. 1 Labor Day holiday, citing 18 main U.S. trading partners.Stocks have rebounded sharply since plunging in April following Trump's "Liberation Day" tariff announcement, as the president pulled back on some of the most severe tariffs. This eased fears about a recession, but markets could remain sensitive to trade developments.Investors also will focus on the U.S. fiscal bill in Congress for indication of the extent of stimulus in the legislation and how much it could widen federal deficits.With a roller-coaster first half nearly complete, the S&P 500 is up about 5% so far in 2025. Over the past 15 years, July has been a strong month for stocks, with the S&P 500 increasing 2.9% in July on average, Wedbush analysts noted in a report this week.Second-quarter U.S. corporate earnings season kicks off in the coming weeks, with concerns over how much tariffs may be biting into company profits or affecting consumer spending. S&P 500 earnings are expected to have climbed 5.9% in the second quarter from a year earlier, according to LSEG IBES data."We've been in a geopolitically focused market over the past several weeks," said Josh Jamner, senior investment strategy analyst at ClearBridge Investments. "I think the dawn of earnings season ... will refocus the market back towards fundamentals."
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First Post
42 minutes ago
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Weekend Senate session focuses on contentious GOP tax cuts and budget reductions
Republicans are using their majorities in Congress to push aside Democratic opposition, but they have run into a series of political and policy setbacks. Not all GOP lawmakers are on board with proposals to reduce spending on Medicaid, food stamps and other programs as a way to help cover the cost of extending some $3.8 trillion in Trump tax breaks read more The Senate is expected to grind through a rare weekend session as Republicans race to pass President Donald Trump's package of tax breaks and spending cuts by his July Fourth deadline. Republicans are using their majorities in Congress to push aside Democratic opposition, but they have run into a series of political and policy setbacks. Not all GOP lawmakers are on board with proposals to reduce spending on Medicaid, food stamps and other programs as a way to help cover the cost of extending some $3.8 trillion in Trump tax breaks. STORY CONTINUES BELOW THIS AD The 940-page bill was released shortly before midnight Friday. Senators were expected to take a procedural vote Saturday to begin debate on the legislation, but the timing was uncertain and there is a long path ahead, with at least 10 hours of debate time and an all-night voting session on countless amendments. Senate passage could be days away, and the bill would need to return to the House for a final round of votes before it could reach the White House. 'It's evolving,' said Senate Majority Leader John Thune, R-S.D., as he prepared to close up the chamber late Friday. The weekend session could be a make-or-break moment for Trump's party, which has invested much of its political capital on his signature domestic policy plan. Trump is pushing Congress to wrap it up, even as he sometimes gives mixed signals, allowing for more time. At recent events at the White House, including Friday, Trump has admonished the 'grandstanders' among GOP holdouts to fall in line. 'We can get it done,' Trump said in a social media post. 'It will be a wonderful Celebration for our Country.' The legislation is an ambitious but complicated series of GOP priorities. At its core, it would make permanent many of the tax breaks from Trump's first term that would otherwise expire by year's end if Congress fails to act, resulting in a potential tax increase on Americans. The bill would add new breaks, including no taxes on tips, and commit $350 billion to national security, including for Trump's mass deportation agenda. STORY CONTINUES BELOW THIS AD But the spending cuts that Republicans are relying on to offset the lost tax revenues are causing dissent within the GOP ranks. Some lawmakers say the cuts go too far, particularly for people receiving health care through Medicaid. Meanwhile, conservatives, worried about the nation's debt, are pushing for steeper cuts. Sen. Thom Tillis, R-N.C., said he is concerned about the fundamentals of the package and will not support the procedural motion to begin debate. 'I'm voting no on the motion to proceed,' he said. Sen. Ron Johnson, R-Wis., pushing for deeper cuts, said he needed to see the final legislative text. The release of that draft had been delayed as the Senate parliamentarian reviewed the bill to ensure it complied with the chamber's strict 'Byrd Rule,' named for the late Sen. Robert C. Byrd, It largely bars policy matters from inclusion in budget bills unless a provision can get 60 votes to overcome objections. That would be a tall order in a Senate with a 53-47 GOP edge and Democrats unified against Trump's bill. STORY CONTINUES BELOW THIS AD Republicans suffered a series of setbacks after several proposals were determined to be out of compliance by the chief arbiter of the Senate's rules. One plan would have shifted some food stamp costs from the federal government to the states; a second would have gutted the funding structure of the Consumer Financial Protection Bureau. But over the past days, Republicans have quickly revised those proposals and reinstated them. The final text includes a proposal for cuts to a Medicaid provider tax that had run into parliamentary objections and opposition from several senators worried about the fate of rural hospitals. The new version extends the start date for those cuts and establishes a $25 billion fund to aid rural hospitals and providers. Most states impose the provider tax as a way to boost federal Medicaid reimbursements. Some Republicans argue that is a scam and should be abolished. The nonpartisan Congressional Budget Office has said that under the House-passed version of the bill, some 10.9 million more people would go without health care and at least 3 million fewer would qualify for food aid. The CBO has not yet publicly assessed the Senate draft, which proposes steeper reductions. STORY CONTINUES BELOW THIS AD Top income-earners would see about a $12,000 tax cut under the House bill, while the poorest Americans would face a $1,600 tax increase, the CBO said. One unresolved issue remains the so-called SALT provision, a deduction for state and local taxes that has been a top priority of lawmakers from New York and other high-tax states. The cap is now $10,000. The White House and House Republicans had narrowed in on a plan for a $40,000 cap, but for five years instead of 10. Republican senators says that's too generous. At least one House GOP holdout, Rep. Nick LaLota of New York, said he cannot support the compromise. Senate Democratic leader Chuck Schumer of New York said Republicans are rushing to finish the bill before the public fully knows what's in it. 'There's no good reason for Republicans to chase a silly deadline,' Schumer said. House Speaker Mike Johnson, who sent his colleagues home for the weekend with plans to be on call to return to Washington, said they are 'very close' to finishing up. STORY CONTINUES BELOW THIS AD 'We would still like to meet that July Fourth, self-imposed deadline,' said Johnson, R-La. With the narrow Republicans majorities in the House and Senate, leaders need almost every lawmaker on board to ensure passage. Johnson and Thune have stayed close to the White House, relying on Trump to pressure holdout lawmakers.
Time of India
an hour ago
- Time of India
'We'll find out': Senate Republicans set for crucial vote on megabill - SALT deal hangs in balance
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Mint
an hour ago
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Amazon, Google, Meta, and Uber slapped with $2 billion retroactive tax bill, Trump suspends Canada trade talks
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