On The Money: Dow hits record high | Optimism on trade deal lifts markets | Appeals court upholds NY prosecutors’ subpoena for Trump tax return

Happy Monday, and welcome to On The Money. I’m Niv Elis, filling in for Sylvan Lane to bring you a wrap up of the latest finance news from Capitol Hill and beyond.

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THE BIG DEAL– The Dow Jones Industrial Average joined the S&P 500 and Nasdaq in reaching a new record, hitting 27,500 in trading on Monday.

{mosads}All three major indexes were at new highs at the end of the day’s trading. The Dow closed for Monday at 27,462, up 115 points. The S&P 500 added 11.36 points, up 0.4 percent, while the Nasdaq rose 46.80 points, up 0.6 percent.

Why the new highs? A better-than-expected jobs report on Friday and strong quarterly earnings have helped push stock markets past a summer slump.

Key points:

• The economy added 128,000 jobs last month, well ahead of the 85,000 to 100,000 economists had predicted due to the now-finished General Motors strike.
• There were strong increases in restaurant and bar employees, social service workers and in the financial sector.
• The trade war with China has been one of the central concerns for businesses and investors and cited as a drag on the nation’s economic growth prospects. Currently, the U.S. and China are in talks to finalize phase one of a trade deal that would delay upcoming round of higher taxes on Chinese goods. In exchange, China would agree to buy more U.S. agricultural products.
• On Monday, shortly before the rally, Commerce Secretary Wilbur Ross said that the U.S. was closing in on an agreement for the “Phase One” trade deal with China. “We’re in good shape, we’re making good progress, and there’s no natural reason why it couldn’t be,” Ross told Bloomberg when asked about whether the deal would be signed later this month.

Read more:

The Wall Street Journal: U.S. stocks outpacing the rest of the world

CNBC: The stock market keeps setting new highs in a rally no one saw coming

LEADING THE DAY – Appeals court upholds Manhattan DA subpoena for Trump tax returns.

A federal appeals court on Monday ruled that President Trump can’t block the Manhattan District Attorney’s Office from subpoenaing his accounting firm for tax returns and financial records, delivering a blow to the president’s claim that he is immune to criminal investigations.

A three-judge panel on the 2nd Circuit Court of Appeals said on Monday that “presidential immunity does not bar the enforcement of a state grand jury subpoena directing a third party to produce non-privileged material, even when the subject matter under investigation pertains to the President.”

But the court noted they were not ruling on all of the sweeping assertions of immunity that the president’s lawyers have claimed. All three of the judges were appointed by Democratic presidents.

What’s the fight over? In August, Manhattan District Attorney Cyrus Vance Jr. subpoenaed the accounting firm Mazars for Trump’s financial records, in part to investigate alleged “hush money” payments the president had made in 2016 to two women who say they had affairs with him.

Trump’s attorneys began to comply before suing to block the subpoena when they learned that Vance’s office was also seeking the president’s tax returns for the past eight years. The lawsuit accused Vance of participating in a “campaign of bad-faith investigations and harassment of the president.”

What’s next? The ruling sets the stage for a potential battle before the Supreme Court, where Trump’s legal team has vowed to take the fight.

Read more from The Hill’s Harper Neidig on the case here.

Job market shields Trump from trade blowback.

A resilient job market and steady consumer spending are helping insulate the U.S. economy from a dangerous mix of global threats, providing some protection to President Trump amid criticism of his ongoing trade war with China.

The October jobs report and the government’s third-quarter GDP estimate, both released this week, were far better than economists had forecast.

“Wow, a blowout JOBS number just out,” Trump tweeted Friday morning, citing an inflated figure dismissed by economists. “This is far greater than expectations. USA ROCKS!”

While employment gains and economic growth have slowed considerably from 2018, the consumer side of the economy has yet to be hit hard by the steep declines in business investment, manufacturing and exports stemming from Trump’s trade policy.

Still, economists warn that a slew of risks — including pending tariffs on Chinese goods and auto imports — could lead to protracted slowdown next year, a development that would undoubtedly weigh heavily on Trump’s reelection prospects. A persistent industrial recession also poses a threat to the president’s popularity in crucial swing states where he has pledged to revive manufacturing jobs.

But without a significant downturn in hiring or consumer spending, the economy may hold up well through much of the 2020 election season.

Read more from Sylvan here. 

GOOD TO KNOW

• President Trump on Sunday refused to commit to keep the government open beyond a November 21 deadline, but lawmakers expect him to sign a funding extension.
• Trump on Monday began the year-long process of formally withdrawing the U.S. from the Paris climate accord.
• Uber stocks dipped after it reported a quarterly loss of $1 billion (yikes!). 
• The U.S. marked the anniversary of the Iran hostage crisis with new sanctions and a reward for a missing American.
• After the IRS approved the change, the Salt Lake Tribune became the first legacy paper to convert to a nonprofit.
• Advocacy groups want the feds to block Google’s Fitbit acquisition.
• Apple is pledging to spend $2.5 billion to boost affordable housing in California.
• Bernie Sanders (I-Vt.) is calling his ‘Medicare for All’ funding plan ‘more progressive’ than the one offered by Sen. Elizabeth Warren (D-Mass.).
• Secretary of Commerce Wilbur Ross said licenses for U.S. companies to sell products to Chinese tech giant Huawei will be coming “very shortly.”