U.S. President Joe Biden signed a temporary spending bill averting a government shutdown and Applied Materials shares fell following reports the U.S. government is investigating it for potential violations of export restrictions. Here’s what investors need to know today.
1. Biden Signs Temporary Government Spending Bill to Avert Shutdown
U.S. stock futures were higher after President Joe Biden signed legislation that will keep the U.S. government funded until early next year, averting a potential shutdown ahead of Friday’s deadline. The legislation establishes a funding deadline for some government agencies such as military construction and veterans affairs on Jan. 19, 2024, while other government programs must be funded by a subsequent Feb. 2 deadline.
2. Applied Materials Shares Fall Following Reports of Federal Probe
Shares of Applied Materials (AMAT) fell more than 7% in pre-market trading after a report that it potentially violated U.S. export restrictions by sending advanced chip making equipment to China without required licenses. The report said the U.S. Justice Department is looking at the transfer of potentially hundreds of millions of dollars in chip making equipment to China’s SMIC through South Korea without export licenses.
3. Gap Shares Jump After Earnings, Revenue Beat
Gap (GPS) shares soared more than 18% in pre-market trading after it reported better-than-expected results on lower commodity costs, fewer promotions, and a series of cost-cutting initiatives that has included layoffs. The apparel retailer’s third-quarter earnings of $0.59 a share was above the $0.19 a share that analysts expected, while its revenue of $3.77 billion came in over analyst calls for $3.60 billion.
4. Ross Stores Raises Annual Earnings Guidance on Strong Demand, Lower Costs
Ross Stores (ROST) reported sales and earnings that beat analyst expectations, as the discount retailer reported strong demand, while lower ocean freight costs helped improve margins. Ross also raised its forecast for annual earnings per share to between $5.30 and $5.35, above its earlier outlook of $5.15 to $5.26. Shares of Ross traded higher by more than 7% in pre-market trading.
5. Housing Starts, Building Permits Projected to Fall
Housing starts are expected to have fallen to 1.35 million in October from 1.36 million in the prior month when those figures are released at 8:30 a.m. ET, while October building permits are projected to come in at 1.45 million, lower than September’s 1.47 million. At 8:45 a.m. ET, Boston Fed President Susan Collins will speak, followed by remarks at 9:45 a.m. ET from Fed Vice Chair Michael Barr and Chicago Fed President Austan Goolsbee, 10 a.m. ET remarks from San Francisco Fed President Mary C. Daly, and a TV appearance by Collins at 10:15 a.m. ET.