Global Outage
CrowdStrike shares plunged up to 13% following a major software update issue that caused widespread disruptions to millions of Microsoft Windows devices. The faulty update from CrowdStrike's Falcon vulnerability-protection software led to system crashes affecting PCs, servers, and displays, impacting various sectors including aviation and healthcare. Despite efforts to quickly resolve the issue, hackers exploited the chaos with malicious websites offering fake updates. Guggenheim Securities downgraded CrowdStrike's stock, citing concerns over potential long-term impacts on the company's reputation and business performance, while Goldman Sachs maintained a buy rating but anticipated delays in deal closures amid the fallout.
Democratic Party Shake Up
President Joe Biden announced on Sunday his decision to withdraw from the 2024 presidential race and endorsed Vice President Kamala Harris as the Democratic nominee. Biden cited growing pressure from within his party and his belief that stepping aside would benefit both the party and the country. His endorsement came amid concerns over his ability to compete effectively against former President Donald Trump, following a challenging debate performance and health issues including a recent COVID-19 diagnosis. The move sets the stage for Harris to lead the Democratic ticket, with Biden's campaign now shifting its support to her candidacy as the party prepares for a competitive election against the Republican ticket of Trump and Sen. JD Vance.
Lowering Interest Rates
Federal Reserve Chair Jerome Powell addressed the Economic Club of Washington D.C., stating the Fed won't wait for inflation to reach 2% before considering interest rate cuts, citing the lag in policy effects. He emphasized the importance of preemptive action to avoid overshooting on tightening measures, potentially driving inflation below target. Powell expressed confidence in the economy, downplaying concerns of a severe downturn. However, he refrained from signaling a timeline for rate cuts, noting the need for more data before the Fed's next policy meeting in July.
