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The markets lacked confidence, and the heated debate over the U.S. Debt Ceiling remained intense.
What you should know today
Congressional Budget Office said that the U.S. could avoid defaulting on debt at least until July due to tax revenues and emergency measures taken in June. The updated guidance reiterated Treasury Sec. Janet Yellen’s warning that the United States may hit its debt ceiling as early as June.
U.S. stock prices fell on Friday, but only slightly, due to weak consumer sentiment. European markets closed up. The CAC 40 Index in France rose 0.45% after Societe Generale exceeded first-quarter earnings expectations and increased 1.2%.
Elon Musk, the current CEO of Twitter, confirmed that Linda Yaccarino is set to become Twitter's new CEO. Musk tweeted that Yaccarino will "focus primarily on the business operations while I focus on new technology and product design."
The Turkish presidential and parliamentary election ended on Sunday. According to Reuters, neither the incumbent president Recep Tayyip Erdoan nor his opposition rival Kemal Kilicdaroglu will be able to clear the 50% threshold for an outright win. The presidential election will then go to a second round on May 28.
Last week, PRO Bitcoin dropped by 11.25%, reaching a two-month low of $28,843. Analysts believe the cryptocurrency is in for a price reverse, as indicated by its head-and shoulders pattern -- three peaks with a middle peak.
The markets lacked confidence, and the debate about the U.S. Debt Ceiling remained roiled with passionate intensity. To borrow W. B. Yeats' words.
U.S. stock prices barely moved on Friday. The Dow Jones Industrial Average was flat, while the S&P 500 fell 0.16%. Weekly, the Dow fell 1.1%, S&P 500 fell 0.3% and the Nasdaq gained 0.4%.
Some stocks on the S&P have risen above the malaise (and fallen to new lows). Pepsico's share price, for example, reached $196.12, its highest since 1965. Match Group, which is the owner of dating apps like Tinder and Match, as well as OkCupid, has fallen to $30.86 a piece, its lowest price since November 2015, when it went public.
Joe Cusick is a portfolio specialist at Calamos Investments and said that "none are making any convincing moves either way, reflecting the general lack of confidence in the market."
Consumers in the United States are losing confidence in the health and stability of the economy, too. The preliminary reading of the University of Michigan Survey of Consumers for May showed a reading of 57.7, which was down from 63.5 last April and the lowest reading in six months.
Investors and consumers have been hesitant to make decisions because the U.S. could default on its debts. In the last week, we have heard dire warnings about the consequences of a U.S. default from JPMorgan Chase CEO Jamie Dimon and U.S. Treasury Sec. Janet Yellen, as well as British Finance Minister Jeremy Hunt. All of them emphasized the same thing: If the U.S., the center for the global financial system, fails to pay its national debts, economic chaos will be unleashed around the world.
After a last minute postponement, U.S. president Joe Biden will continue the talks about the debt ceiling with other lawmakers in early this week. Investors, banks and world leaders will all soon know if the U.S. is able to avoid a new crisis.