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House Republicans narrowly approved their budget framework Thursday, a political turnaround after Speaker Mike Johnson worked into the night to satisfy GOP holdouts who had refused to advance trillions of dollars in tax breaks without deeper spending cuts. Johnson stood with Senate Majority Leader John Thune early in the morning at the Capitol to shore up President Donald Trumps “big, beautiful bill, and they committed to seeking at least $1.5 trillion in cuts to federal programs and services. The speaker had abruptly halted voting Wednesday night. I told you not to doubt us, Johnson, R-La., said afterward. He acknowledged the week’s economic turmoil with the financial markets a little unstable, but said the House vote was a big day.” The 216-214 vote pushed the budget plan forward, one more milestone for Johnson, and next step in a lengthy process to unlock the centerpiece to the presidents domestic agenda of tax cuts, mass deportations and a smaller federal government. A failed vote, particularly as the economy was convulsing over Trumps trade wars, would have been a major setback for the party in power in Washington. Two conservative Republicans voted against it, as did all Democrats. Trump, at a black-tie fundraising dinner this week, had admonished Republicans to “stop grandstanding on the budget. By Thursday morning, Trump had shifted his tone. Biggest Tax Cuts in USA History!!! Getting close, Trump said. The House action still leaves weeks, if not months, ahead, on a final product, with more votes in Congress. Johnson could lose only a few detractors from his slim Republican majority. Democrats, in the minority, lack the votes to stop the package, but they promised to fight every step of the way. House Democratic leader Hakeem Jeffries of New York said the GOP budget plan was a toxic scheme that proposed the largest cuts to the Medicaid health care program and food assistance in the nation’s history all in service of enacting massive tax breaks to their millionaire donors, like Elon Musk. The businessman is leading Trump’s cost-cutting efforts through the Department of Government Efficiency. Jeffries said Democrats will push back until they bury this budget resolution in the ground. But late Wednesday, the outcome was in flux. At least a dozen conservative Republicans, if not more, were firmly against the plan. Several of them, including members of the ultraconservative Freedom Caucus, made the unusual move of walking across the Capitol to meet privately with Senate GOP leaders to insist on deeper cuts. As night fell, Johnson pulled a group of Republicans into a private meeting room as House proceedings came to a standstill. They stayed into the night hashing out alternatives, and were back at it in the morning. Johnson said he spoke with Trump for about five minutes while the GOP meeting was taking place. The president is very anxious for us to get this done, Johnson said. But House GOP conservatives, including several of those who met with Trump this week, were concerned that the Senate GOP’s blueprint, approved last weekend, did not cut spending to the level they believe necessary to help prevent soaring deficits. The Math Does Not Add Up, Rep. Chip Roy, R-Texas, had posted earlier on social media. Rep. Andy Harris, R-Md., the Freedom Caucus chair, led others to meet with the senators. In the end, Harris, Roy and almost all the holdouts came on board. They said they were assured by Johnson, Thune and Trump that there would be steep cuts ahead. Republican Reps. Thomas Massie of Kentucky and Rep. Victoria Spartz of Indiana voted no. We got as much as we could, said Rep. Tim Burchett, R-Tenn. We realized it was bigger than us.” Before the vote, Thune, R-S.D., tried to assure House conservatives that many GOP senators were aligned with their pursuit of spending reductions. We certainly are going to do everything we can, Thune said. But the details ahead will matter. Key Republican senators already signaled their disapproval of some $800 billion in House-proposed cuts that could hit Medicaid and other vital programs. Johnson insisted that the health care and other services that millions of Americans rely on, particularly Medicare, Medicaid and Social Security, would be spared. Republicans instead are seeking to impose new restrictions on benefits and cut what they portray as waste, fraud and abuse, following DOGE’s efforts. The House and Senate are at the beginning phase of a process as they turn their budget resolutions into legislative text a final product expected later this spring or summer. Central to the budget framework is the Republican effort to preserve the tax breaks approved in 2017, during Trump’s first term, while potentially adding the new ones he promised during his 2024 campaign. That includes no taxes on tipped wages, Social Security income and others, ballooning the price tag to some $7 trillion over the decade. The package also allows for more than $500 billion in budget increases, including some $175 billion to pay for Trump’s deportation operation and as much for the Defense Department to bolster military spending. The plan would also raise the nation’s debt limit to allow more borrowing to pay the bills. Trump had wanted lawmakers to take the politically difficult issue off the table. With debt now at $36 trillion, the Treasury Department has said it will run out of funds by August. But the House and Senate need to resolve their differences on the debt limit, as well. The House GOP increases the debt limit to $4 trillion, but the Senate lifted it to $5 trillion so Congress would not have to revisit the issue again until after the midterm elections in November 2026. To clip costs, the Senate is using an unusual accounting method that does not count the costs of preserving the 2017 tax cuts, some $4.5 trillion, as new spending, another factor that is enraging the House conservatives. Lisa Mascaro and Kevin Freking, Associated Press Associated Press writers Mary Clare Jalonick, Stephen Groves, Leah Askarinam, and Matt Brown contributed to this report.
Category:
E-Commerce
As the threat of a U.S. trade war with China continues to send markets tumbling, the headlines have been chock full of stock market lingo. Now, analysts are saying the S&P 500 Index is on the precipice of bear market territory, but what does that even mean? Here’s a look at this and other Wall Street terms currently in the news. What is a bear market? First things first. A bear market is defined as when a broad market index, like the Standard and Poor’s 500 (S&P 500) falls by 20% or more from its recent peak for a sustained period of time. The S&P 500 is a good gauge because it tracks the performance of 500 leading companies listed on U.S. stock exchanges. Another good example is the Dow Jones Industrial Average. Are we in a bear market? We certainly got close: On Monday, the S&P 500 opened lower, down 17.4 percent from its high on February 19. A close of Mondays trading with a loss of at least 3.1 percent would have tipped it into a bear market, according to the New York Times. But after stock markets surged on Wednesday after President Trump’s 90-day pause of reciprocal tariffs, we’re a little less at risk. However, stock markets continued to fall on Thursday: The S&P 500 closed down 3.34%, while the Dow Jones Industrial Average fell 2.46%, and the Nasdaq Composite fell 4.31%. For some context, the last bear market occurred in 2022, when the S&P benchmark fell 34% in a one-month period, per the Associated Press. What’s the difference between a bear and bull market? Unlike a bear market, which marks a decrease of 20% or more from a recent market high, a bull market indicates a period when the index is rising. As Fidelity Investments points out, that could be a 20% increase from recent lows, although there are other thresholds. There have been 26 bull markets since 1877. As the AP explains it, bears hibernate while bulls charge ahead. What is a ‘circuit breaker’ and what causes the market to halt trading? Market-wide circuit breakers temporary halt trading during a major market decline to prevent panic during high volatility. In the U.S., those rules are governed and implemented by the Securities and Exchange Commission (SEC), and were created to prevent a repeat of the 1987 market crash when the Dow lost 22.6% in a day. Today, these rules have been updated to halt U.S. trading when the S&P 500 Index drops 7%, 13%, and 20% in a day. The first two circuit breakers halt trading for at least 15 minutes, and can only be triggered between 9:30 a.m. ET and 3:25 p.m. ET, according to Barron’s, who note if the S&P 500 declines 20%, that would stop trading for the rest of the day. On Monday, Nikkei stock futures trading briefly halted on Japan’s Tokyo Stock Exchange after the Nikkei 225 fell 7%, adding to last weeks 9% drop. A circuit breaker, was triggered at 8:45 a.m. local time, which paused trading for 10 minutes, the Wall Street Journal reported. That circuit breaker kicks in when trading is set to rise or fall more than 8%. While the trading paused the Nikkei 225 and several other futures contracts, it did not stop the direct buying and selling of stocks on the exchange.
Category:
E-Commerce
Chinese tea chain Chagee said on Thursday it was targeting a valuation of up to $5.1 billion in its U.S. initial public offering, braving choppy market conditions. Market volatility stemming from uncertainty over U.S. trade policy has tempered IPO activity as companies adopt a wait-and-see approach before proceeding. Shanghai-based Chagee is seeking up to $411 million by offering nearly 14.7 million American depositary shares priced between $26 and $28 each. The IPO also comes as the world’s two biggest economies are locked in an escalating trade war, prolonging macroeconomic uncertainty. While Chagee warned of some hit from the tariffs, it said “cross-border trade” was not its principal business. All of its products are manufactured in China. China in recent years has tightened scrutiny around firms pursuing offshore IPOs. Last year, Beijing stalled listings of several tea beverage companies worried over the poor performance of listed peers. Chagee, which specializes in raw-leaf fresh milk tea, is the latest in a string of Chinese consumer brands to pursue offshore IPOs in recent months. Chinese bubble tea firms Mixue and Guming went public in Hong Kong earlier this year. Chinese IPOs on U.S. exchanges raised $1.15 billion in 2024, compared with $469.7 million in 2023, according to data compiled by LSEG. That amount was still far below the $12.85 billion raised in 2021. “The IPO market rarely shuts down completely, and when it does, it doesn’t happen for long,” said Matt Kennedy, senior strategist at Renaissance Capital, a provider of IPO-focused research and ETFs. Cornerstone investors have indicated interest in purchasing Chagee’s shares worth up to $205 million sold in the IPO. Rapid rise Founded in 2017 by Junjie Zhang, Chagee opened its first store in Yunnan province and has since rapidly expanded across and beyond China. The tea brand generated 29.5 billion yuan ($4.03 billion) in sales last year, with over 6,000 teahouses worldwide at the end of 2024. Nearly all of its stores are set in China under a franchise scheme. Chagee plans on serving customers across 100 countries and selling 15 billion servings annually as it aggressively expands its global reach. In recent years, Chagee has expanded across Southeast Asia, entering Malaysia, Singapore and Thailand. Chagee will list on the Nasdaq under the symbol “CHA”. Citigroup, Morgan Stanley, Deutsche Bank and CICC are the lead underwriters for the offering. ($1 = 7.3140 Chinese yuan renminbi) Arasu Kannagi Basil, Pritam Biswas, and Ateev Bhandari, Reuters
Category:
E-Commerce
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