Trump's F-35 Sales to Saudis, Mexico Drug Strikes, and Fed Rate Cut Debate

Market Performance and Economic Outlook

• 📉 Wall Street experienced a risk-off day, with the S&P 500, Nasdaq, and Dow all closing down, ahead of key economic reports.
• 📊 The ten-year Treasury yield settled at 4.13%, and the two-year yield at 3.6%.
• ⚠️ Fed Vice Chair Phillip Jefferson indicated that risks to the labor market are skewed to the downside, expecting a slight increase in unemployment.
• 📉 Governor Christopher Waller, however, reiterated his view that the central bank should lower interest rates next month due to a weak labor market.

Foreign Policy and Defense

• ✈️ President Trump stated his intention to sell F-35 fighter jets to Saudi Arabia, citing their status as a great ally and the need to counter Iran.
• 💥 Trump also expressed openness to U.S. military strikes inside Mexico to combat drug trafficking and stated he would be proud to "knock out cocaine factories in Colombia."

Legal and Justice Department Developments

• ⚖️ Lawyers for Fed Governor Lisa Cook are disputing mortgage fraud allegations, calling them based on an