Stocks were just slightly higher today after Congress reached a budget deal.
House and Senate negotiators including Patty Murray and Paul Ryan approved a plan that will avoid automatic budget cuts such as the sequester from earlier this year. As long as the two chambers of Congress approve it, we can avoid a repeat of the October government shutdown. Both President Obama and Speaker Boehner applauded the bipartisan deal. Some Republicans say that the spending cuts in the deal don't go far enough, however.
The budget deal brings us closer to removing that uncertainty of another government shutdown, which means that the Federal Reserve would have less reason to continue its stimulus program. As a result, global equities have been poor today. Economists surveyed by Bloomberg said that the Fed will probably begin reducing asset purchases at their meeting next week.
US stock indices are relatively flat before the opening bell today. Dow
(INDEXDJX:.DJI) futures were up 0.05% to 15,986. S&P 500
(INDEXSP:.INX) futures fell 0.04% to 1,803.80 and futures on the Nasdaq Composite
(INDEXNASDAQ:.IXIC) were flat at 3,515.00.
Costco Wholesale Corporation
(NASDAQ:COST) reported today that earnings per share for the fiscal first quarter were $0.96, missing estimates by $0.07. Revenue of $24.47 billion also fell short of expectations. Shares of the discount retailer fell 1.7% in pre-market trading.
Smith & Wesson Holding Corp
(NASDAQ:SWHC) shares jumped 5.8% this morning after the gun maker reported fiscal second quarter earnings that exceeded expectations. The shooting at an elementary school a year ago spurred a national conversation on gun control, which brought the company a 27% year-over-year rise in handgun sales. Revenue rose 2% to $139.3 million and EPS came in at $0.28.
(NASDAQ:CSCO) shares fell 1% this morning after it lost a bid to overturn the European Union's approval of Microsoft's
(NASDAQ:MSFT) acquisition of Skype in 2011. The EU court ruled that the Skype acquisition does not restrict competition for video conferencing.
(NYSE:MA) shares rose 4% after the bank card company's board approved an 83% hike in dividends and a 10-for-1 stock split.
No positions in stocks mentioned.
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