- Home Depot drops after annual sales forecast cut
- Capital One up as Berkshire Hathaway reveals stake
- Horizon falls after FTC to block Amgen’s deal to buy co
- Futures: Dow down 0.24%, S&P off 0.07%, Nasdaq flat
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May 16 (Reuters) – Dow futures fell on Tuesday after a dour forecast from Home Depot ahead of critical debt limit talks, and retail sales data that will offer more insight on the economy’s health.
The main indexes started the week with modest gains as trading was range-bound amid a wrangling in Washington between the White House and Republicans.
They will sit down later in the day to try to make progress on a deal to raise the U.S. government’s $31.4 trillion debt ceiling and avert an economically catastrophic default.
“There is little chance we will see a resolution to the U.S. debt ceiling issue today,” said Ipek Ozkardeskaya, senior analyst at Swissquote Bank.
“The negotiations will likely remain tight as Republicans ask decent spending cuts to accept a debt ceiling relief, while Biden is not willing to compromise on spending into the election year.”
Dow Jones Industrial Average (.DJI) component Home Depot (HD.N) shed 4.4% in premarket trading after the home improvement chain cut its annual sales forecast, with Americans cutting back on spending on tools and building materials as inflation stays sticky.
Shares of rival Lowe’s Companies Inc (LOW.N) fell 3.2%, while retail giant Walmart Inc (WMT.N) slipped 0.4%.
Focus will also be on economic data, with retail sales expected to increase by 0.8% in April after falling 0.6% in the month before.
Data recently has pointed to a slowing U.S. economy, which is starting to feel the heat of the Federal Reserve’s restrictive monetary policy, and also heightened expectations for when the central bank will pause its hiking cycle.
At 6:56 a.m. ET, Dow e-minis were down 80 points, or 0.24%, S&P 500 e-minis were down 3 points, or 0.07%, and Nasdaq 100 e-minis were up 5.25 points, or 0.04%.
Shares of Capital One Financial Corp (COF.N) jumped 6.3% after Berkshire Hathaway Inc (BRKa.N) on Monday disclosed it has begun investing in the consumer lender.
Berkshire also upped its stake in HP Inc (HPQ.N), sending its shares up 1.6%, while shedding stake in regional bank US Bancorp (USB.N), which slipped 1.2%.
Horizon Therapeutics (HZNP.O) slid 17.8% as the Federal Trade Commission is expected to file a lawsuit to block Amgen Inc’s (AMGN.O) $27.8 billion deal to buy the company. Shares of Amgen rose 1.2% in thin volumes.
Reporting by Shreyashi Sanyal in Bengaluru; Editing by Maju Samuel
Our Standards: The Thomson Reuters Trust Principles.
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TORONTO, April 23 (Reuters) – A strike by about 155,000 Canadian federal government workers is closer to a resolution, with progress made on remote work and wage increases for Treasury Board employees, the union said on Sunday.
The strike is scheduled to continue for now amid ongoing talks about a deal for revenue agency workers, the Public Service Alliance of Canada (PSAC) said in a statement. The union has said it will “escalate” its actions on Monday.
A wide range of public services from tax returns to passport renewals have been hit since last Wednesday, when 120,000 Treasury Board workers and 35,000 revenue agency staff represented by the PSAC went on strike.
“At Treasury Board we made some headway on remote work language, and both sides have moved in order to get closer to a resolution on wage increases,” said Chris Aylward, National President of PSAC.
The talks with the government about wage increases for revenue agency workers, who oversee tax returns, have not made progress, he added.
The revenue agency workers wanted a pay hike of 22.5% over three years, while the Treasury Board workers who oversee federal government administration were seeking a 13.5% pay rise over three years. The government offered both groups a 9% increase over three years.
Canada’s annual inflation rate peaked at 8.1% last year but has since come down to about half of that.
In addition to higher wages, the union is also demanding flexibility to work from home.
A government spokesperson told Reuters on Sunday that it had received an offer from the union the previous evening and presented a counter-offer in response, without providing further details.
Reporting by Divya Rajagopal; Editing by Lisa Shumaker
Our Standards: The Thomson Reuters Trust Principles.
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