Stocks are are little changed as Democrats and Republicans continue to tussle over Washington's fiscal policy.
Index futures are pointing toward a slightly higher opening. Dow
(INDEXDJX:.DJI) futures are up 0.08% at 13,032.00. S&P 500
(INDEXSP:.INX) futures rose 0.06% to 1,416.50, and Nasdaq
(INDEXNASDAQ:.IXIC) futures climbed 0.11% to 2,683.00.
Yesterday, Treasury Secretary Timothy Geithner presented the White House's formal plan to avoid the fiscal cliff. The proposal includes $1.6 trillion in tax increases over 10 years. The debt ceiling, which was used to essentially shut down the government and raise the possibility of default, will be eliminated. Under the new plan, Congress would have to vote to block increases in the debt limit rather than approve them. There will also be $50 billion in middle and lower class tax breaks and stimulus spending, such as infrastructure projects and mortgage refinancing. The payroll tax holiday will be extended for another year, as will emergency unemployment benefits.
House speaker John Boehner balked at the proposal, saying that the Democrats "have yet to get serious about real spending cuts."
Consumer spending in October fell 0.2% after rising 0.8% the month before. Economists expected a modest 0.1% rise in spending, but it is possible that Hurricane Sandy discouraged customers from shopping toward the end of the month. Personal income stagnated in the month as well. An increase of 0.3% was expected, but income remained flat.
According to an SEC filing yesterday, Facebook
(NASDAQ:FB) and Zynga
(NASDAQ:ZNGA) broke their two-year agreement which gave Zynga games such as FarmVille
prominence on Facebook. Zynga will no longer be required to let users sign in with Facebook credentials and use Facebook Payments to make purchases. It also won't have to serve Facebook ads. Though Facebook denies plans to develop its own games, it now has the option of doing so. Other game makers can also use the Facebook platform. Zynga shares dropped 8.4% since the filing was released after trading hours yesterday.
(NYSE:TEVA) shares declined by 1.17% after the company reported revenue and earnings that fell short of analyst expectations.
Japan released a bunch of data today that could raise hopes for a quick turnaround. Industrial production unexpectedly rose 1.8% in October after plunging 4.1% in September. The fall in household spending slowed to 0.1% last month from 0.9%. Consumer prices stayed flat on a monthly basis, but the currency deflated by 0.3% from a year ago. Unemployment stayed unchanged at 4.2%. Japan's parliament approved another 880 billion yen stimulus package to revive the faltering economy yesterday.
Eurozone unemployment rose, as expected, to a record high of 11.7% in October. The rate in Italy hit an eight-year high of 11.1%. German retail sales fell 2.8%, the most in two years.
Detroit is finding itself on a fiscal cliff of its own. If the city doesn't get Michigan's $30 million in aid by the third week in December, it will run out of cash and default.
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