Aurelia Butler

(Reuters) – The S&P 500 closed higher on Friday but off session highs, as a Tesla (NASDAQ:TSLA) rally failed to galvanize the broader market on the eve of the Federal Reserve’s policy meeting and inflation data next week.Tesla Inc shares climbed 4.06%, clinching their longest winning streak since January 2021, after General Motors Co (NYSE:GM) agreed to use the company’s Supercharger network. GM shares rose 1.06%.The benchmark S&P 500 built on Thursday’s 20% rise from its Oct. 12 finishing low, heralding the start of a new bull market as defined by some market participants.”It’s maybe the most hated bull market in the history of bull markets,” said Tim Holland, chief investment officer of investment platform Orion OCIO.”Sentiment was terribly depressed going into year-end and still remains on the bearish side.”The S&P 500 gained 4.93 points, or 0.11%, at 4,298.86, taking this week’s advance to 0.38% and extending its winning streak to four weeks, the longest since the July-August 2022 period. The Nasdaq Composite notched its seventh straight week of gains, adding 20.62 points, or 0.16%, to 13,259.14 on the day and 0.13% on the week. The Dow Jones Industrial Average rose 43.17 points, or 0.13%, to 33,876.78, for a weekly gain of 0.33%.A megacap stocks rally, better-than-expected earnings season and expectations that the Fed was nearing the end of its rate-hiking cycle have supported Wall Street this year despite concerns about a looming recession and sticky inflation.Shares in tech companies including Apple Inc (NASDAQ:AAPL), Advanced Micro Devices (NASDAQ:AMD) and Nvidia (NASDAQ:NVDA) Corp rose between 0.22% and 3.20% after retreating earlier this week.Traders see a 72% chance of the U.S. central bank holding interest rates at the current 5%-5.25% range in its June 13-14 policy meeting, according to CMEGroup’s Fedwatch tool.”The overall tone of the market is based on the idea that the Fed will pause its increases,” said Rick Meckler, partner at Cherry Lane Investments. “As it pauses, the broader market will start to rally and maybe catch up with the large-cap tech stocks that have led the way up until now.” Consumer prices data on Tuesday will help shape expectations around further moves by the Fed, with traders already pricing in a 50% chance of another 25-basis-point rate hike in July.The CBOE Volatility index, commonly known as Wall Street’s fear gauge, sank to the lowest level since February 2020 before regaining some ground. Target Corp (NYSE:TGT) slipped 3.26% after Citi downgraded the big-box retailer to “neutral,” saying sales could fall further this year due to economic challenges.Adobe (NASDAQ:ADBE) Inc rose 3.41% after Wells Fargo (NYSE:WFC) upgraded it to “overweight,” saying the Photoshop software maker was poised to benefit from the generative AI boom.Netflix Inc (NASDAQ:NFLX) gained 2.60% following a report that the streaming giant’s subscriptions jumped after its crackdown on password sharing.Declining issues outnumbered advancing ones on the NYSE by a 1.49-to-1 ratio; on Nasdaq, a 1.84-to-1 ratio favored decliners.The S&P 500 posted 15 new 52-week highs and five new lows; the Nasdaq Composite recorded 84 new highs and 53 new lows. More

WASHINGTON (Reuters) -Republicans in the U.S. House of Representatives on Friday unveiled a series of new tax breaks aimed at businesses and families while proposing to reverse some of President Joe Biden’s legislative victories, including credits to spur the sale of clean-burning electric vehicles.Three related bills were introduced on Friday with the goal of moving the legislation through the House Ways and Means Committee next week. That is when the Joint Committee on Taxation also is expected to release its analysis of the package.White House spokesperson Karine Jean-Pierre termed the proposals a “tax scam” and alleged that “(Republican) priority isn’t reducing the deficit or out-competing the world, their priority is giving handouts to rich special interests and corporations at the expense of everyone else.”Democrats already were focusing on whether the tax legislation could add to the ballooning federal debt.”These policies will provide relief for working families, strengthen small businesses, grow jobs, and protect American innovation and competitiveness,” Ways and Means Chairman Jason Smith said in a statement.The committee said there are hundreds of billions of dollars worth of provisions included. Some are expansions of tax breaks while others eliminate or roll back existing ones, such as Biden’s electric vehicle credit.Representative Richard Neal, the panel’s senior Democrat, said Republicans were “laying the groundwork for even bigger cuts in 2025” when provisions of the 2017 tax law expire. The measure introduced on Friday, Neal said, would usher in “retroactive corporate tax cuts, next-to-nothing for the most vulnerable children and families, and sneaking in favors for Big Oil.” Republicans, who control the House, introduced the proposals days after Biden, a Democrat, signed into law legislation Republicans sought to begin addressing the rapidly-growing debt with about $1.3 trillion in spending cuts.The law was coupled with an urgently needed increase in U.S. borrowing authority by suspending the debt limit through Jan. 1, 2025. Under the proposed legislation, married couples filing jointly would receive a $4,000 “deduction bonus” for two years that the committee said would potentially help up to 107 million families who take the standard deduction.The legislation also would significantly increase the way businesses could claim depreciation deductions, raising the threshold to a permanent $2.5 million from the current $1 million that was contained in the Republicans’ broad 2017 tax cut package. Other provisions include an expansion of tax benefits for small start-up enterprises to “S Corporations,” while eliminating some “red tape” that small businesses experience related to contract workers.Democrats on the Ways and Means panel are expected to offer amendments to the bill, including a permanent expansion of an expired portion of the Child Tax Credit that lifted nearly 4 million children out of poverty in just one year during the coronavirus pandemic. Republicans have opposed the measure.Any bill that emerges from the House would likely face stiff opposition in the Democratic-controlled Senate. More

NEW YORK (Reuters) – A U.S. stocks rally is showing signs of expanding beyond the cluster of giant growth and tech names that have led gains this year, as investors reposition portfolios primed for a widely expected recession.For months, investors piled into a handful of megacap companies seen as safe bets in uncertain times, spurring a rally that has lifted the S&P 500 nearly 12% year-to-date, concentrated in a small group of stocks.As the U.S. economy holds up despite higher interest rates, fears of an imminent downturn are fading. Some investors have started dipping their toes into economically sensitive market areas that have been out of favor this year including small caps, energy shares and industrial stocks – all of which have seen hefty rallies in June.”We’re seeing indications that the economy is going to be more resilient to headwinds,” said Tim Murray, a capital market strategist in T Rowe Price (NASDAQ:TROW)’s multi-asset division. “There’s reason to believe that the pessimism we saw at the start of the year is giving way to a stronger-than-expected market.” Murray has increased his allocation to small-cap stocks, which tend to be among the most direct beneficiaries of economic growth. The Russell 2000 small cap index of small cap companies has surged 6.6% this month. The index is up 5.9% year-to-date.Other rebounding segments in June include the S&P 500 energy sector, which has gained 6% this month and S&P 500 industrials, up 5.7%. Energy is down 7.6% year-to-date, while industrials have risen nearly 4%.By contrast, the tech-heavy Nasdaq 100 has gained about 2% this month – though the recent underperformance follows a nearly 33% year-to-date surge on excitement over developments in artificial intelligence. A broadening equity rally would be a welcome development for many investors, who have worried about the market’s narrow leadership. Just seven stocks – Apple Inc (NASDAQ:AAPL), Microsoft Corp (NASDAQ:MSFT), Alphabet (NASDAQ:GOOGL) Inc, Amazon.com Inc (NASDAQ:AMZN), Nvidia (NASDAQ:NVDA) Corp, Meta Platforms Inc (NASDAQ:META), and Tesla (NASDAQ:TSLA) Inc – have been responsible for almost all of the S&P 500’s gains this year, data from S&P Dow Jones Indices showed. “This kind of dominance is unusual but you’re starting to see it turn around,” said Howard Silverblatt, senior index analyst at S&P Dow Jones Indices. Ten of the 11 S&P 500 sectors are firmer for the month to date, compared to only six for the year. An additional sign that investors are looking further afield can be seen in the market’s breadth: the percentage of S&P 500 stocks trading above their 200-day moving average stood at nearly 54% on Friday, up from a low of 38% in March. That is still off from the high of 76% reached in February, however.Stronger-than-expected jobs growth and robust consumer spending have been among the data points that have bolstered investors’ economic outlook.Among the firms revising recession forecasts were Goldman Sachs (NYSE:GS), which in the past week cut its probability of a recession in the next 12 months to 25% from 35%, while Nuveen’s Chief Investment Officer Saira Malik recently wrote that a “mild” recession has likely been delayed from late 2023 to sometime in 2024.Investors in the coming week will be watching U.S. consumer price data on Tuesday for signs that the Fed’s rate hikes are continuing to cool inflation without badly hurting growth. The Fed concludes its two-day monetary policy meeting on Wednesday, and while most market participants expect the U.S. central bank to leave rates unchanged, many will also be gauging policymakers’ appetite for future tightening.Some market watchers believe it is too early for economic optimism. Analysts at Capital Economics wrote on Thursday that the small-caps rally was likely premature, saying they expected softer growth in coming months. Jobless claims released on Thursday were higher than expected, a sign that the labor market could be cooling.Others, however, are more optimistic. Max Wasserman, senior portfolio manager at Miramar Capital, has been increasing his positions in underperforming consumer stocks such as Starbucks Corp (NASDAQ:SBUX) and Target Corp (NYSE:TGT), respectively down around 1% and 15% year-to-date. He expects restaurants and retailers to outperform as growth stabilizes in the second half of the year.”That’s when we think we will be rewarded,” he said. More

NEW YORK (Reuters) – Georgia-based slot machine operator Lucky Bucks filed for bankruptcy Friday, saying that it had reached a deal to cut $500 million in debt and turn over the company’s equity to its lenders.Lucky Bucks suffered from increasing interest rates on its debt, an inflationary environment that reduced consumers’ use of slot machines, and a regulatory crackdown on slot machine operators in Georgia, according to its court filings in Wilmington, Delaware bankruptcy court.Georgia law places strict limits on slot machines, prohibiting cash winnings, and preventing locations like gas stations and convenience stores from having more than nine slot machines or deriving more than 50% of their revenue from slot machines, according to the company.The state’s increased policing of those rules caused the removal of 500 Lucky Bucks slot machines in the first five months of 2023 alone, according to court documents.Headquartered in Norcross, Georgia, Lucky Bucks operates in 345 locations throughout Georgia with approximately 2,300 slot machines. The machines are classified as “skill-based” games under Georgia law, and winning must be redeemed for non-cash merchandise or lottery tickets instead of cash.James Boyden, Lucky Bucks’ executive vice president of corporate development, said in a statement that the bankruptcy would not cause any disruption for the company’s employees, business partners, or consumers.Lucky Bucks may choose to sell its business if a buyer steps forward with a better offer than the proposed debt-reduction deal, according to court documents. Lucky Bucks entered bankruptcy with $610 million in debt. The proposed restructuring is supported by 86% of the company’s lenders, the company said in a statement. Lucky Bucks is owned by private equity firm Trive Capital, which acquired the company as part of its 2020 acquisition of the formerly public company Seven Aces.Before filing for bankruptcy, Lucky Bucks had lobbied for a Georgia law that would have protected slot machine operators from “predatory” competition. The proposed bill, which was not passed by Georgia’s legislature, would have prevented a new slot machine from being installed in the nine months following the removal of a different company’s slot machine.The case is Lucky Bucks Inc, U.S. Bankruptcy Court for the District of Delaware, No. 23-10758.For Lucky Bucks: Dennis Dunne and Tyson Lomazow of Milbank LLP and Russell Silberglied of Richards, Layton & Finger PARead more:ATM maker Diebold Nixdorf (NYSE:DBD) files for bankruptcy to cut $2 billion in debtAtlantic City casino-hotels accused in scheme to boost room rates More