Obama Rejects Republican Budget Proposal, US Stocks Fluctuate

US President Barack Obama has rejected the budget offer presented by the Republicans as he doesn’t think that offer is good enough to shrink the country’s economic deficit. Only yesterday, the Standard & Poor’s 500 Index suffered losses and this rejection will definitely not do the economy any good. Today, the US stocks have mostly fluctuated between profits and losses. The S&P 500 Index also declined by 0.3% and is currently at 1405.56. On the other hand, the Dow Jones Industrial Average plummeted by 0.1% (It lost around 9.44 points). It is currently at 12956.16. The Trading in S&P 500 companies was measured to be 9.1% lower if compared to the 30-day average.

Prudential Financial’s Market Strategist, Quincy Krosby stated that the clock is ticking for US and the market is currently waiting for a decision. US stocks will continue to stay volatile and headline-driven for the rest of the year, until, a decision is made on the so called fiscal cliff. 

Obama stated that the budget offer of Republicans wasn’t good enough to shrink the US deficit of $4 trillion that the Government is planning to overcome by end of this decade. However, he acknowledged that the bill to spend cuts and increase taxes for high earners may get some alteration before being put into place.

Coming to the individual company stocks, both Vegas Sands Corp. and Wynn Resorts Ltd. experienced losses of 3%. On the whole, casino company shares have seen a tumble as police in Macau and China have detained people from three of the biggest junket operators in the last few weeks. The biggest chipmaker in the world, Intel Corp. however surged by 1.3%. The company decided to sell the bonds in a three-part offering for repurchasing its stocks and this probably helped it.

After agreeing to a merging proposal with T-Mobile USA Inc., the MetroPCS Communications Inc. share prices sank by 7.4%. It’s currently at $9.97 per share. The owner of Olive Garden chains and Red Lobster, Darden Restaurants, saw a huge decline in the share prices, as its prices plummeted by 11%. The 2nd quarter preliminary profit of the company is lower than the initial expectations set and that have attributed to this huge fall. Oshkosh Corp. also plummeted by 4.2%, as Carl Icahn, the Billionaire investor dropped his bid to buy Oshkosh.