Dow Plunges After Opening Bell as Democrats Set to Reject Trump’s Proposal to End Government Shutdown
U.S. stocks opened sharply lower on Tuesday, as Democrats wasted little time talking down President Trump’s new border-security proposal to end the partial government shutdown. Oil prices also faced a sharp correction as China growth woes rattled investors.
All of Wall Street’s major indexes traded lower after the opening bell, with the Dow Jones Industrial Average falling by as much as 188 points. The Dow 30 index was last down 154 points, or 0.6%, at 24,552.12. The broad S&P 500 Index declined 0.7% to 2,652.82, with ten of 11 primary sectors trading lower. The technology-focused Nasdaq Composite Index declined 0.8% to 7,101.06.
U.S. markets were closed on Monday for Martin Luther King Jr. Day. U.S. futures prices were down across the board in the holiday-shortened session.
The last full trading session on Friday saw gains of 1% to 1.3% for the major indexes.
The S&P 500’s energy index declined 1.8% at the start of trading Tuesday as oil prices faced a brisk selloff. U.S. and international crude prices were down more than 2% on worries that China’s slowing economy will impact energy demand.
As Hacked reported on Monday, China’s economic growth slowed to 6.6% in 2018, the lowest rate of expansion in 28 years.
The West Texas Intermediate (WTI) benchmark for U.S. crude futures declined $1.33, or 2.5%, to $52.71 a barrel on the New York Mercantile Exchange. Brent crude, the international futures benchmark, declined $1.41, or 2.3%, to $61.32 a barrel.
Senate to Reject Trump’s New Proposal
Senate Democrats this week are expected to reject President Trump’s new proposal to end the partial government shutdown, which has now entered day 31. With another employee pay deadline over the horizon, Republicans and Democrats are under pressure to resolve the impasse, which has shattered the previous record for longest in history.
On Saturday, President Trump laid out a new plan for funding his proposed border wall that included key compromises on DACA and immigrants with Temporary Protected Status. As we reported on CCN, the proposal included a three-year extension for immigrants that fall under either category, as well as additional funds for urgent humanitarian care, additional border agents and drug protection technology.
House Speaker Nancy Pelosi immediately rejected the proposal, and has since gone on to call it a “nonstarter,” according to The Wall Street Journal. As WSJ notes, the proposal is unlikely to receive the 60 votes necessary to pass in the Senate and wouldn’t survive the Democrat-controlled House.
Featured image courtesy of Shutterstock. Charts via TradingView and Barchart.