Ben Werschel, a Washington correspondent, dives into the implications of the Senate's shutdown deal, boosting market optimism. Ali Canal, a senior reporter, sets the stage for Disney's earnings, highlighting concerns over its first profit decline amid streaming challenges. Michael O'Rourke, Chief Market Strategist, warns of AI developments resembling the dot-com bubble, advising caution and strategic positioning as growth slows. Together, they unravel the intertwined fates of politics, corporate earnings, and tech market dynamics.
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Shutdown Vote Spurs Market Rally
The Senate's procedural vote creates a clear path to reopen the government through Jan. 30 and fund key programs like SNAP.
Markets rallied on the hope of a deal and the eventual return of missing economic data that could inform Fed decisions.
insights INSIGHT
Inflation Data Likely Delayed
The CPI release is likely lost because price data collection stopped during furloughs, so this week's inflation print is unlikely.
Jobs and other data may return quickly after reopening but will need days of federal workers being back to compile releases.
insights INSIGHT
Strategists See AI-Powered Bull Case
Strategists are turning bullish on tech, with UBS forecasting S&P 500 at 7,500 by end-2026 driven by AI-fueled gains.
The Nasdaq led pre-market gains after last week's AI-led selloff, showing concentrated tech strength can drive broader indices.
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US stock futures climb as Washington inches closer to ending the government shutdown. The Senate advanced a bipartisan bill 60–40 that would reopen the government through January 30, fully fund key programs like SNAP, and add new limits on President Trump’s power to fire federal workers. The House still needs to act, but hopes for a deal are fueling a risk-on rally, with Nasdaq (^IXIC) futures leading after last week’s AI-led selloff. A reopening would also bring long-delayed economic data back online, though the White House has already signaled this week’s CPI report is likely a full casualty of the shutdown.
Earnings remain in focus with Disney (DIS) set to report what’s expected to be its first adjusted profit decline in more than two years as revenue growth slows. Investors will be watching strength in parks and cruises, Disney+ pricing power, early demand for the new ESPN streaming service, and any hints on CEO Bob Iger’s successor before his planned 2026 exit. On the deal front, Pfizer (PFE) is buying obesity-drug startup Metsera after Novo Nordisk (NVO) dropped its bid, monday.com (MNDY) slides on tempered guidance, and Instacart (CART) pops on resilient grocery demand. All of it comes as strategists debate whether the AI boom is starting to look a lot like the dot-com bubble — even in blue-chip names.
Takeaways:
Senate advances shutdown deal that would reopen government through Jan. 30 and fully fund SNAP
Markets rally on hopes for a resolution and the eventual return of key economic data, even as this week’s CPI is likely scrapped
Disney earnings on deck: parks and cruises strong, streaming margins and ESPN DTC in focus, plus long-running questions about Bob Iger’s successor
Pfizer wins Metsera obesity-drug bidding war over Novo Nordisk; monday.com cuts guidance, Instacart beats on steady grocery demand
Strategists warn of “bubble-like” AI behavior even in high-quality names as trillion-dollar deals and mega pay packages pile up
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