On Tuesday, the Nasdaq 100 ETF (QQQ) closed with a 0.84% loss while the S&P 500 ETF (SPY) inched lower by 0.03%.
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In the early morning, President Trump threatened to cancel subsidies for companies controlled by Elon Musk as the feud between the two billionaires over Trump’s megabill reemerges. Without subsidies, “Elon would probably have to close up shop and head back home to South Africa,” said Trump on Truth Social.
Trump’s megabill cleared another hurdle after the Senate voted 51-50 to approve it, sending the document back to the House. Vice President JD Vance was responsible for the tie-breaking vote after three Republicans defected. Tomorrow, the House will begin the process of debating the bill and then voting on it, said House Majority Whip Tom Emmer.
Meanwhile, the May Job Openings and Labor Turnover Survey (JOLTS) report provided an encouraging signal for the job market. Job openings came in at 7.769 million, above the estimate for 7.300 million and rising from the upwardly revised figure of 7.395 million in April. May’s layoffs number also came in lower than expected.
On the trade front, Trump has demoted the prioritization of Japan in favor of other countries, like India, according to Nikkei Asia. He also threatened to hit the country with tariff rates as high as “30%, 35% or whatever the number is that we determine.” The two sides continue to disagree on specific items like rice, energy, and cars. “We are not thinking about doing anything that would sacrifice the farm sector,” said Japanese chief cabinet secretary Yoshimasa Hayashi on Tuesday.
Finally, the odds of a 25 bps reduction to the federal funds rate in July rose to 21.2% compared to 18.6% yesterday and 18.6% a week ago. Speaking at the European Central Bank forum in Portugal, Fed Chair Jerome Powell said he “can’t say” if July is too early to consider cutting rates, explaining that the Fed’s decision will ultimately be based on economic data.