Stocks Whipsaw as Deals Takes Shape
Stocks in the US got off to a soft note as investors reverse some of the gains seen at the end of last week. Volatility declined during the tail end of the prior week as investors looked forward to an agreement between the House and the Administration which failed to produce any substantial results. The senate is now back in the fold, trying to work with House representatives on producing an agreement that will avoid a US default. Toward the end of the trading session, both parties announced a deal was close which sent stocks into the black. The Nasdaq 100 was the best performing of the major indices climbing xx points.
The equity markets continue to be volatile and tt may take Washington several days before a budget deal is ratified, so there’s no clear end in sight on the shutdown. Although many believe a default is unlikely the real risk seems to be that officials will kick the can down the road, setting up still another shutdown crisis later this fall, then another during the winter, then another in the spring. This scenario risks damage to consumer psychology which will slump even further amid this uncertainty.
In corporate news, Canada’s Toronto-Dominion Bank is weighing an 8 billion pound bid for Royal Bank of Scotland’s American retail banking business Citizens, according to the U.K’s The Sunday Times newspaper. RBS, which is 80% owned by British taxpayers, said in February that it would sell 20-25% of Citizens in the next two years through an initial public offering in New York.
BlackBerry (NYSE:BBY) stated in an open letter that it affirms it is financially stable and that it aims to cut costs by some 50% going forward, according to a document that will be published in the broader media Tuesday and previewed on the Globe and Mail website.
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