Market Overview

Height Securities: Odds Of Government Shutdown Are Nearly 50-50, But Congress Still Likely To 'Kick The Can'

Height Securities: Odds Of Government Shutdown Are Nearly 50-50, But Congress Still Likely To 'Kick The Can'
Related SPY
Trump, Pelosi, Schumer Bicker In Meeting About Wall Funding, Government Shutdown
A Peek Into The Markets: US Stock Futures Surge Ahead Of Producer Price Index
It Looks Like It's Getting Worse Before It Gets Any Better (Seeking Alpha)

There’s a major deadline approaching in Washington, D.C. later this week, and Height Securities said Congress is likely prepared to do what many would argue it does best — nothing. 

In a new note to clients on Wednesday, Height Securities said there’s a 45-percent chance the government will shut down as a result of Congress failing to pass a spending bill by the deadline midnight Friday. The more likely scenario, the firm said, is that Congress will once again simply choose to kick the can down the road by extending its spending bill deadline by another month. Either way, Congress is not likely to pass a much-needed spending bill by the end of the week, Height said. 

“The latest government funding bill offered by Congressional Republicans does not provide a straightforward path toward resolution by midnight this Friday, but we still think it is more likely than not enough Democrats will join Republicans to simply kick the can for four weeks (until Feb. 16) on the government funding and immigration debates,” according to Height. 

Democrats and Republicans remain deeply divided on the DACA immigration debate, and Democrats are insisting the next government funding bill include money for DACA in order to snag any Democratic votes. Several fiscally conservative Republicans plan to vote against the current Republican spending bill, likely leaving its fate in the hands of Democrats.

“Republicans have a 51-49 vote margin [in the Senate] and will need numerous Democrats to break ranks to pass a spending bill,” Height said.

After so many government shutdown threats in the past, investors seem to be mostly ignoring the noise out of Washington. Despite the looming deadline, the SPDR S&P 500 ETF Trust (NYSE: SPY) is up 1.3 percent over the past five trading sessions.

Related Links:

This Day In Market History: Operation Desert Storm

A Look Ahead To Trump's Decision On Solar Tariffs

Posted-In: Congress DACA Donald Trump government shutdownAnalyst Color Politics Top Stories General Best of Benzinga


Related Articles (SPY)

View Comments and Join the Discussion!

Latest Ratings

TVPTImperial CapitalDowngrades15.8
ACORGoldman SachsDowngrades10.0
BCOVB. Riley FBRUpgrades12.0
CAMPFirst AnalysisDowngrades22.0
View the Latest Analytics Ratings
Don't Miss Out!
Join Our Newsletter
Subscribe to:
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Fintech Focus
Your weekly roundup of hot topics in the exciting world of fintech.
Thank You
for registering for Benzinga’s newsletters and alerts.
• The Daily Analysts Ratings email will be received daily between 7am and 10am.
• The Market in 5 Minutes email will be received daily between 7am and 8am.
• The Fintech Focus email will be received every Friday between 2pm and 5pm.

Apple Says It Will Invest $350 Billion In The US

BioBlast CEO Calls Price Spike 'Bizarre'