The US Markets took a dive on Wednesday as the red wave of expected Republican gains in the midterm elections appeared more a slight pink. The news from the crypto sector was bad as Binance is seen increasingly unlikely to follow through on its takeover of FTX.com, and tomorrow we get the upcoming inflation data that will provide clues about the severity of future interest rate hikes.
Whilst Republicans were still favored to win control of the House of Representatives, key races were too close to call, with a better-than-expected showing by Democrats diminishing the prospect of a so-called red wave of Republican gains.
Major indexes added to declines as Treasury yields climbed further after a poor auction of 10-year notes by the U.S. Treasury. Treasury yields reversed and fell later in the day. The 10-year was last at 4.099, while the 2-year was at 4.5816. Traders are split over whether the Fed will raise rates by 50 basis points or 75 basis points in December.
In tech, Meta Platforms bucked the trend lower to rise more than 5% after the social media company detailed plans to cut more than 11,000 jobs or 13% of its workforce. The cost-cutting was welcomed by Wall Street amid frustrations about the company’s ongoing plan to invest in the metaverse.
Binance signed a non-binding agreement on Tuesday to buy FTX’s non-U.S. unit to help cover a “liquidity crunch” at the rival exchange, but the deal was subject to further due diligence.
“As a result of corporate due diligence, as well as the latest news reports regarding mishandled customer funds and alleged US agency investigations, we have decided that we will not pursue the potential acquisition of FTX.com,” Binance said in a statement.
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