US stock futures point higher after debt ceiling deal

On Monday, after lawmakers in Washington secured an agreement to raise the $31.4 trillion debt limit and prevent a potentiall catastrophic default, US stock futures rose in muted holiday trade.

The Dow futures contract increased by 60 points or 0.18% around 07:32 ET (11:32 GMT), the S&P 500 futures increased by 10 points or 0.23%, and the Nasdaq 100 futures increased by 57 points or 0.39%.

Stock markets will be closed on Monday for Memorial Day.

The debt ceiling will be raised until 2025 under the agreement reached over the weekend by President Biden and Republican House Speaker Kevin McCarthy. Non-defence spending will be capped for the next two years.

Although the agreement’s provisions have already drawn criticism from some members of their respective parties, Biden and McCarthy claimed that it resulted from compromise.

The accord was criticised by the so-called Freedom Caucus, a group of very conservative Republicans, for leaving out some significant expenditure cutbacks. Meanwhile, left-leaning Democrats have criticised Biden for making too many significant concessions.

Later this week, it is anticipated that the Democratically-controlled Senate and the Republican-controlled House of Representatives will vote on the agreement. The Treasury Department predicts that by June 5, the federal government will not have enough money to cover its obligations.

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