The daily business briefing: June 12, 2018

Harold Maass
President Trump speaks to reporters in Singapore
Win McNamee/Getty Images
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Stocks flat after Trump-Kim summit

U.S. stock futures held firm early Tuesday following the unprecedented summit between President Trump and North Korean leader Kim Jong Un. Trump and Kim signed an agreement committing to the denuclearization of the Korean Peninsula, but revealed few details on how they would make it happen, leaving investors cautious. Futures for the Dow Jones Industrial Average, the S&P 500, and the Nasdaq-100 all edged down by about 0.1 percent. Trump said the two sides had committed to more negotiations and to improving relations. South Korea's Kospi index fell by 0.1 percent after the agreement, and Japan's Nikkei 225 gained 0.3 percent. [CNBC]


Trump's top economic adviser in good condition after heart attack

White House economic adviser Larry Kudlow suffered a heart attack on Monday and was taken to Walter Reed Medical Center, where he was reported to be in good condition. President Trump tweeted the news ahead of his North Korea summit. White House Press Secretary Sarah Huckabee Sanders said Kudlow's doctors described the heart attack as "very mild," and they "expect he will make a full and speedy recovery." Kudlow, a former CNBC contributor and Wall Street economist, has been leading efforts to pull together a trade policy toward China and U.S. allies. Over the weekend he said Canadian Prime Minister Justin Trudeau "stabbed us in the back" with "polarizing" comments after a Group of Seven meeting in which tensions flared over Trump's new tariffs. [CNBC]


Judge hears arguments on Trump profit from foreign governments

Lawyers for Maryland and the District of Columbia on Monday asserted in federal court that President Trump was "profiting on an unprecedented scale" from foreign government interests at his Washington, D.C., hotel, in violation of the Constitution's "emoluments" clause, which bans payments to federal officials from foreign governments. Justice Department lawyers said Trump is doing nothing wrong when his hotel rents rooms to foreign officials, as long as he does not do favors for them in return. U.S. District Judge Peter J. Messitte, who will decide this summer whether the case can move forward, questioned the Justice Department's take on the ban. If a foreign government rents rooms at the Trump hotel and touts it to get in good with Trump, "That's not covered?" he asked. [The Associated Press, The Washington Post]


Net neutrality rules expire

The Obama-era net neutrality rules intended to guarantee an open internet expired on Monday, opening the door for internet providers to offer paid "fast lane" web services. The Federal Communications Commission repealed the landmark rules in December in a 3-2 vote, with FCC Chairman Ajit Pai and the other two Republicans backing the repeal with support from internet service providers. Without net neutrality, critics warn, giant corporations like Verizon and Comcast can throttle traffic to sites they don't own or partner with, or give customers who pay more better connections to services like Netflix. The Senate passed a bill in May reinstating net neutrality, but the House is not expected to take it up. The fight now moves to court. [Reuters]


Fed starts two-day meeting with rate hike expected

Federal Reserve policy makers on Tuesday head into a two-day policy meeting widely expected to conclude with an interest rate hike. Investors are expected to focus on what the Fed statement after the meeting says about the central bank's next steps. As the economy gains strength, the Fed is unwinding its efforts to boost the economy with asset purchases and low interest rates, but investors are looking for signs of whether the Fed is planning to end the current cycle of interest rate increases, or speed it up to keep inflation in check. The Fed's language in policy statements "is growing increasingly stale with each successive rate hike," Goldman Sachs economists Spencer Hill and Jan Hatzius wrote ahead of the policy-setting Federal Open Market Committee meeting. [Reuters]