Stock Market Live Updates: Stocks hit record closing high

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4:02 p.m. ET: Stocks hit record closing high

Here’s where markets settled Tuesday at the end of regular equity trading Tuesday:

• S&P 500 (^GSPC): +0.03%, or 1.07 points

• Dow (^DJI): +0.11%, or 31.27 points

• Nasdaq (^IXIC): +0.1%, or 9.13 points

• 10-year Treasury yield (^TNX): -1.1 bps to 1.878%

• Gold (GC=F): -0.00% to $1,480.50 per ounce

2:29 p.m. ET: House passes $1.4 trillion spending bill to avert shutdown

The U.S. House passed $1.37 trillion in spending, in a deal that includes funding for a border wall, funding for gun violence research, and raising the age for purchasing tobacco products from 18 to 21, USA Today reports.

1:25 p.m. ET: Netflix climbs after revealing overseas growth

Netflix shares rose 3.4% after the company published data indicating strong growth internationally, Reuter reports.

12:15 p.m. ET: Bed Bath and Beyond spikes on C-Suite housecleaning

The embattled retail chain (BBBY) saw its stock skyrocket 8% intraday on Tuesday, after The Wall Street Journal reported that it was booting half a dozen senior executives just as pre-Christmas shopping picks up speed. BBBY has been under pressure from shareholders amid declining sales and an ugly year in which it reported its first annual loss.

12:06 p.m. ET: Trump to travel to Davos: Reuters

A source familiar with Trump’s plans tell Reuters that the president will travel to the World Economic Forum in late January, after having to cancel last January because of the government shutdown.

12:00 p.m. ET: Jobs market still strong: JOLTS

(Reuters): U.S. job openings rebounded from an 18-month low in October and layoffs declined sharply, data showed on Tuesday, which could ease some fears that demand for workers was ebbing.

Job openings, a measure of labor demand rose 235,000 to 7.27 million, the Labor Department said in its monthly Job Openings and Labor Turnover Survey, or JOLTS, on Tuesday. But the rise did not recoup all of the drop of 269,000 in September, which pushed vacancies down to their lowest level since March 2018.

11:00 a.m. Capital Economics: Boeing may ding growth by 0.5%

Fears about the impact of Boeing’s woes on the economy are growing, with Capital Economics echoing JPMorgan on how the 737 MAX’s production halt could undermine growth:

Boeing’s decision to halt production of the 737 Max aircraft could deliver a big hit to the manufacturing sector just as prospects were beginning to brighten. If it the shutdown lasts the entire quarter we estimate it could knock up to 0.5%-pts annualized off first quarter GDP growth. Moreover, if staff at Boeing’s suppliers are furloughed or laid off over the coming weeks, there’s a risk the damage could be even worse.

Michael Pearce, Capital Economics’ senior US economist, says Boeing already took a bite out of Q2 growth this year, to the tune of about 0.2%. If sustained, the 737 MAX mess could be even worse this time around:

Based on Boeing’s production rates and prices, we calculate that the decision to stop production entirely of the 737 will reduce output of commercial aircraft by around $25 bn annualized. That hit will come entirely in the first quarter. If the pause persisted through the end of March, that would reduce first quarter GDP by a similar amount, equivalent to a 0.5%-pt hit to annualized growth. It is possible that production will resume before the end of the first quarter, however, if regulatory approval arrives early next year.

...There is a risk of a broader hit to the economy as the decision ripples through the supply chain. Boeing has said that the 12,000 production staff working on the jet will be reassigned, but it appears likely that at least some of the workers at the more than 600 smaller companies in the supply chain will be furloughed or laid off as a result of the decision. Suppliers may also put on hold investment plans. The longer the shutdown persists, the more likely that is, delivering a broader hit to consumption and investment growth. Those effects, if they appear, will show up first in the jobless claims and consumer confidence figures.

After being down over 1% on the day, Boeing stock clawed back to trade up half a percent on the session, around $328.73.

10:45: Big banks settle Fannie, Freddie bond rigging claims

Thirteen prominent banks and financial services companies agreed to pay $337 million to resolve claims by investors that they conspired to rig prices of bonds issued by mortgage companies Fannie Mae and Freddie Mac for a decade.

10:25 a.m. ET: Deutsche sees U.S. growth boosted by Fed, fiscal

In a newly-published outlook, Deutsche Bank sees growth hitting 2.0% next year, driven mainly by higher consumer spending, but with capital spending held in check by election uncertainty that will displace trade policy as “the main bugaboo” of the private sector:

Improved growth prospects next year rest importantly on our assumptions that a trade escalation is avoided with China and auto tariffs are put aside. Escalation on these fronts, along with some generic "election year" uncertainty, would put the fragile improvement in consumer and business sentiment in doubt and risk pushing the economy into a mild recession.

Beyond 2020, we see growth rising slightly above 2%. While fiscal policy now in place points to some drag in those out years, we expect the 2020 election to result in moderate fiscal stimulus, with spending growth increased and revenue growth either flat or down. Some Fed easing in 2021 will help as well, but trade policy uncertainty could remain or even intensify again as a headwind to growth.

Based on this growth outlook, we expect the labor market to remain sturdy, but a declining natural rate of unemployment and subdued inflation expectations will hold core PCE inflation below the Fed’s target for the foreseeable future. Quiescent inflation will in turn keep the Fed on hold through 2020.

10:12 a.m. ET: Trump calls for Fed to engineer weaker dollar

In a Twitter post, President Donald Trump — who’s been relatively silent on Fed policy after haranguing them for much of the year — called on the central bank to nudge a “very strong” dollar lower:

Would be sooo great if the Fed would further lower interest rates and quantitative ease. The Dollar is very strong against other currencies and there is almost no inflation. This is the time to do it. Exports would zoom!

— Donald J. Trump (@realDonaldTrump) December 17, 2019

The president has occasionally sounded off about the greenback’s strength, which affect the competitiveness of U.S. exports.

10:10 a.m. ET: Amazon, FedEx fight may boost UPS

The fight between Amazon (AMZN) and FedEX (FDX) is heating up, with the retail giant telling its third-party sellers they couldn’t use the shipment giant for Prime deliveries, citing a drop in delivery performance. After The Wall Street Journal broke the story late Monday, FDX dropped 2%, despite the company saying the shift would have a minimal impact since FedEx severed ground delivery ties with Amazon in August, and Express shipping in June.

Bank of America thinks the battle will only bolster demand for UPS (UPS):

Amazon's third-party sellers can still use FedEx Express for prime orders (albeit a costlier option vs Ground), or continue using FedEx Ground or Home delivery for non-Prime orders until the ban is lifted.

While unfavorable weather through the Midwest and Northeast has recently impacted on time performance, data from ShipMatrix for the second week of the holiday season indicated FedEx's on-time performance dropped to 90.4% (vs first four weeks of 2018 holiday season at 96.9%), behind Amazon (93.7%), UPS (92.7%) and the Postal Service (92.3%).

Couriers remain under tighter schedules to deliver items pre-Christmas given six fewer days this holiday shopping season. While the repercussions of Amazon's decision will be felt by smaller shippers, peer UPS could benefit from the transfer of incremental volume until Amazon's ban is lifted.

9:30 a.m. ET: Stocks pull back from records as Boeing weighs on Dow

Wall Street took a breather at Tuesday’s opening bell, as the boost from a U.S.-China mini deal that sent stocks to new records began to wane, and investors weighed the economic impact of Boeing’s decision to halt production on its troubled flagship plane.

Here’s where the markets began trading:

• S&P 500 (^GSPC): flat, or +2.49 points

• Dow (^DJI): flat, or -1.84 points

• Nasdaq (^IXIC): flat, or 6.34 points

• 10-year Treasury yield (^TNX): flat around 1.868%

• Gold (GC=F): -0.02% to $1,480.20 per ounce

Extended declines in shares of Boeing (BA) weighed on the Dow after the plane-maker announced it would be indefinitely suspending production of the 737 Max, which has been grounded globally since March after being involved in two deadly plane crashes.

The company stated the production halt would not result in layoffs, yet economists are already predicting the pause will translate into a drag on growth. According to JPMorgan Chase’s Michael Feroli:

We estimate that Boeing’s recent announcement of an indefinite halt in 737 MAX starting in January will have the effect of subtracting around 0.5%-point from 1Q20 annualized real GDP growth. Of course, the presumed eventual resumption of 737 MAX production should provide a lift to GDP growth when that occurs.

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