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Debt ceiling, May jobs report, Nvidia's AI products: Top stories

Yahoo Finance Live's Brad Smith breaks down several of the top news headlines developing this morning including the tentative debt ceiling deal facing key votes in Congress, Friday's May jobs report, and Nvidia stock rising after unveiling more AI products.

Video transcript

BRAD SMITH: Here are the three things that you need to start your morning. We have a tentative deal. President Biden and House Speaker Kevin McCarthy have struck an accord that would extend the US debt limit for two years. It just needs to pass both chambers of Congress by June 5-- the much anticipated X date. The bipartisan deal labeled as historic by Speaker McCarthy capped spending for the next two years.

The other key details that will eliminate $1.4 billion in IRS funding, it ends the pause on student loan repayments and overhauls the National Environmental Policy Act. Now, this could expedite a natural gas pipeline backed by Senator Joe Manchin and will be seen as a big win for Republicans and a blow to climate activists. The bill's first test comes today as it faces the House Rules Committee. The gatekeeper of any legislation heading to the forum.

And investors thinking this is a done deal, they still have a slew of headwinds to contend with, not the least of which the June FOMC meeting which is now pricing in a quarter point rate hike. US data continues to tell two different stories here. Of course, services still hot while manufacturing screaming recessionary alarm bells.

There are two big data points ahead of that crucial meeting. The first comes this Friday with the May jobs report. We'll be looking for continued signs of resilience in the labor market. Plus, with prices still elevated, US CPI the day before the meeting will more than set the tone. Last week, the Fed's preferred gauge showed the fights to contain price rises is far from over.

And number three, the market's AI darling isn't done outperforming. Nvidia is kicking off this week in the green after its $184 billion rally last week. The chipmaker is doubling down on generative AI with the unveiling of its new supercomputer at the Computex form in Taiwan.

CEO Jensen Huang is saying that the company has closed the digital divide. It unveiled a host of new products, including new robotics design and advertising services. A skeptical response from Cathie Wood amid the fervor, however. She says Nvidia is priced ahead of the curve.