US: Congress Edges Closer To Funding Deal After White House Details 'Anomalies'
The implied probability of a government shutdown on October 1 dipped below 40% after White House officials gave Congressional Republicans the green light to move forward with funding negotiations if White House 'anomalies' are included. While the baseline expectation now leans toward a deal, the risk remains elevated.
- Politico reports the Trump administration and hardline House conservatives want a stopgap funding plan through January 31 or beyond. Appropriators want a shorter continuing resolution to allow for full-year funding negotiations.
- Senate Minority Leader Chuck Schumer (D-NY) remains adamant he won’t swallow another partisan funding extension after being panned for folding in a March standoff.
- This time around, Schumer and House Minority Leader Hakeem Jeffries (D-NY) are aligned on their priorities but it is not immediately clear what concessions from the GOP could facilitate a deal beyond extending expiring Affordable Care Act (Obamacare) tax credits, which GOP Leader John Thune (R-SD) appeared to rule out yesterday.
- Punchbowl writes, “This is a growing political problem for moderate Republicans, as more than four million Americans could lose coverage without the subsidies. Rank-and-file Democrats say an extension of Obamacare credits is their minimum demand...”
- Axios writes, “The pressure is rising on Democrats to stiff President Trump and let the government shut down on Oct. 1… a shutdown fight might be the only action that appeases their deeply unsatisfied party base.”
Figure 1: Government Shutdown by October 1
Source: Polymarket
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US TSY OPTIONS: TY Week 2 111.50 Puts Lifted
TY week 2 (exp 8/13) 111.50 puts paper paid 0-07 on 12K.
EQUITY TECHS: E-MINI S&P: (U5) Bounce Holds
- RES 4: 6523.63 1.764 proj of the May 23 - Jun 11 - 23 price swing
- RES 3: 6500.00 Round number resistance
- RES 2: 6477.31 1.618 proj of the May 23 - Jun 11 - 23 price swing
- RES 1: 6468.50 High Jul 31 and the bull trigger
- PRICE: 6413.50 @ 14:34 BST Aug 11
- SUP 1: 6239.50 Low Aug 1
- SUP 2: 6238.83 2.0% 10-dma Envelope
- SUP 3: 6216.34 50-day EMA
- SUP 4: 6213.75 50% retracement of Jun - Aug Upleg
Prices recovered well Friday, meaning the bulk of the bounce off the NFP low is holding firm, keeping the underlying uptrend intact for now. The index holds above support at the 20-day EMA, at 6343.83. Through recent phases of weakness, the 50-day EMA at 6224.07, has held as support - and will be important on any intraday declines. Clearance of this average is required to signal a stronger reversal. The primary trend remains up, leaving key short-term resistance and the bull trigger at 6468.50, the Jul 31 high.
SOFR: SFRU5 Blocked
Most recent block trade lodged at 08:45:31 NY/13:45:31 London:
- SFRU5 8K lots blocked at 95.915, looks like a buyer.
- DV01 $200K.
