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(Fixes duplicated cause in first paragraph) NEW YORK (Reuters) -The Dow and S&P 500 registered record closing highs on Friday, with interest rate-cut expectations improving as the U.S. government shutdown went on for a third day, while the Nasdaq eased. Shares of big tech-related names mostly fell. Shares of Applied Materials were down after the chip-equipment maker late Thursday forecast a $600 million hit to fiscal 2026 revenue. Shares of Tesla also were lower, while the S&P 500 utilities gained. The U.S. government shutdown dragged on for a third day. Investors were still able to digest a survey by the Institute for Supply Management, which showed the services employment index contracted for the fourth consecutive month. The news underscored the case for more interest rate cuts from the Fed. "It certainly feels like momentum is on the side of investors over the last few days," said Mona Mahajan, head of investment strategy at Edward Jones. It seems like "the market probability of a Fed rate cut has actually gone up since the shutdown began," she said. "Maybe that's because there's the potential impact on the economy or some weaker jobs data this week or this morning's ISM data… the expectation is we're still in this environment where the Fed is going to cut rates." The market has historically been mostly unaffected by shutdowns but some strategists said that a longer shutdown could create more uncertainty for investors and for Federal Reserve policymakers.  According to preliminary data, the S&P 500 gained 0.47 points, or 0.01%, to end at 6,715.82 points, while the Nasdaq Composite lost 63.19 points, or 0.28%, to 22,780.86. The Dow Jones Industrial Average rose 242.00 points, or 0.52%, to 46,761.72. "The market generally looks past government shutdowns because they don't usually last long and they don't have a longer-term negative impact on the economy," said Anthony Saglimbene, chief market strategist at Ameriprise Financial in Troy, Michigan. "But the longer it goes… it means the data collection for really important reports could get delayed, or it could cloud some of the data that we will eventually get because the data collection wasn't happening over an extended period." Chicago Fed President Austan Goolsbee said he was hesitant to commit to a series of rate cuts with inflation still running above the target.  Shares of USA Rare Earth rose after CEO Barbara Humpton told CNBC the company was "in close communication" with the White House. (Additional reporting by Niket Nishant and Sukriti Gupta in Bengaluru; Editing by Krishna Chandra Eluri, Pooja Desai and Aurora Ellis)

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(Reuters) -AbbVie expects third-quarter earnings to include a $2.7 billion charge related to in-process research and development (IPR&D) expenses, the drugmaker said in a regulatory filing on Friday. It also forecast third-quarter adjusted earnings per share in the range of $1.74 to $1.78, including the impact of the IPR&D expense. AbbVie said such expenses may arise from collaborations, licensing deals or asset acquisitions, but are not forecast in advance due to uncertainty around timing and occurrence. Including the third-quarter charge, AbbVie now expects full-year adjusted EPS to range between $10.38 and $10.58 compared with the prior range of $11.88 to $12.08. (Reporting by Siddhi Mahatole in Bengaluru; Editing by Sahal Muhammed)

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By Luciana Magalhaes and Leticia Fucuchima SAO PAULO (Reuters) -J&F Investimentos SA, the holding company owned by Brazil's billionaire Batista brothers, is in talks to acquire French utility EDF's Rio de Janeiro thermal plant, according to two people familiar with the matter. The deal, which could fetch up to 2 billion reais ($374 million) according to one of the sources, has drawn interest from other bidders, they added. One of the sources noted that the asset sale, coordinated by Bank of America, is still in its early stages and J&F has not yet made a binding offer. The negotiations are part of a wave of dealmaking in Brazil's power sector this year, which could soon include big deals from players including Canada's Brookfield and France's Engie, people familiar with the matter said. Asked about talks to sell its Norte Fluminense plant, EDF said it is weighing IPOs of its North American and Brazilian subsidiaries as part of a 10-year global plan to boost the growth of its portfolio and long-term investment capacity. J&F and Bank of America declined to comment. FRENCH UTILITY REFOCUSES ON DOMESTIC NUCLEAR As part of a strategic overhaul, EDF is weighing options for its Brazilian assets while reducing its overseas presence and divesting non-core assets to refocus on domestic nuclear projects. The natural gas-fired plant is operating without long-term contracts from buyers, making it attractive to J&F, which often seeks underperforming assets for turnaround, a source said. J&F's power company Ambar Energia has other plants without long-term contracts in its portfolio. J&F, which also owns meatpacker JBS, has expanded its reach in the energy sector through its subsidiary Ambar Energia. The holding company separately made an offer this week to buy Roraima Energia, a power distribution company in the northern Brazilian state owned by the Oliveira Energia group. Last year, J&F signed a preliminary agreement with Oliveira Energia to take control of the power distribution company in Amazonas, but the deal has yet to be finalized. (Reporting by Luciana Magalhaes and Leticia FucuchimaEditing by Brad Haynes and Lisa Shumaker)

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By David Lawder and Lisa Baertlein WASHINGTON (Reuters) -The top Democrat on the U.S. Senate Finance Committee accused the Trump administration of having inadequate customs procedures in place as it ended the "de minimis" U.S. tariff exemption for packages valued below $800, leading to severe disruptions in mail shipments to U.S. shoppers and small businesses. Senator Ron Wyden in a letter to Commerce Secretary Howard Lutnick seen by Reuters requested answers on how the department concluded that adequate systems were in place to collect duties on low-value packages as the exemption ended on August 29. Wyden, one of the Democratic Party's most influential voices on tax and trade matters in Congress, sought to put a negative spin on the administration's claim that it closed a dangerous trade loophole. The de minimis exemption allowed nearly 1.4 billion packages to enter the U.S. duty free in 2024 and fueled a boom in direct-to-consumer e-commerce shipments from Chinese e-commerce firms Shein and Temu . Wyden said the change was "hasty," leading to "mass disruptions in international shipments, confusion and increased costs for American consumers and small businesses." He cited data from the U.N.'s Universal Postal Union (UPU) showing that on August 29, the day the de minimis exemption ended, total postal shipments to the U.S. had fallen 81%. "I have serious concerns about your judgment and seek additional information regarding your role in the decision to abruptly end de minimis without proper systems in place to handle the change," Wyden wrote in the letter to Lutnick. The U.S. Customs and Border Protection agency, which is charged with collecting import duties, did not immediately respond to a request for comment, nor did the Commerce Department. A spokesperson for the UPU said the agency would be updating its U.S. shipment figures, which do not include commercial express shipments such as those from FedEx or United Parcel Service, in coming weeks. The U.S. Postal Service declined to comment on incoming shipment volumes for foreign postal packages. Shippers of illicit drugs and fentanyl precursor chemicals also have exploited de minimis due to limited inspections for many packages claiming the exemption. (Reporting by David Lawder and Lisa Baertlein; editing by Diane Craft)

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By Michael S. Derby (Reuters) -Federal Reserve Governor Stephen Miran on Friday again pressed for an aggressive path of rate cuts citing the impact of Trump administration policies on the economy, while other central bank officials made the case for a more cautious approach citing still-worrisome inflation pressures. “My view is that if policy is out of whack, you should adjust it at a reasonably … brisk pace,” Miran said in an interview on Bloomberg television. When it comes to the current setting of central bank interest rate policy, “we're not at the point yet where, if you sort of keep it there another day, it's a crisis, but if you keep it there for an extra year, yeah, I think you have…problems on your hands.” Miran said his belief that monetary policy needs to be much easier than it is now is based on his view that economic shifts largely on the immigration front suggest that the so-called neutral interest rate has declined from where it was. That means that if left near current levels, Fed policy has become more restrictive of growth, Miran said.  Miran spoke on a day the government was supposed to release its latest employment sector report but did not due to a shutdown created by elected leaders' failure to agree on a budget. Miran did not express concern about missing the key data, noting the central bank still has time before its next meeting scheduled for late October.  Miran is the Fed's newest governor and in a highly unusual state of affairs is on leave from a job at the Trump White House. He dissented in favor of a half-percentage-point rate cut at the interest-rate setting Federal Open Market Committee meeting last month. Then, officials trimmed their federal funds rate target range by a quarter percentage point to between 4% and 4.25% as they sought to balance a desire to lower still-high inflation while providing support for a weakening jobs market.  Officials also penciled in further rate cuts and see the interest rate target in the 3.5% to 3.75% range by year's end, with a move to between 3.25% and 3.5% in 2026.  Miran's preference for aggressive rate cuts puts him at a distance from most policymakers, especially as a wide range of regional Fed bank presidents are still worried about lowering rates with inflation well above the Fed's 2% target and expected to accelerate as President Donald Trump's tariffs surge through the economy.  SERVICES INFLATION PUTS FED IN A STICKY SPOT Speaking on CNBC, Chicago Fed President Austan Goolsbee said the Fed now finds itself in "a bit of a sticky spot" with recent data showing an upswing in services inflation while payroll job creation has been weakening.  "You see this uptick in inflation and particularly the uptick in services inflation, which is probably not coming from tariffs," he said, adding "I'm a little wary about front-loading too many rate cuts and just counting on the inflation going away." Meanwhile, Dallas Fed President Lorie Logan remained hawkish and told a conference that "we really need to be cautious of further rate cuts from here" in an environment where things like non-housing services inflation remain "worrisome" and suggestive that current above-target inflation is not just a tariff-driven issue.  Fed second-in-command Philip Jefferson also spoke in remarks that noted the recent rate cut was important to help ward off further trouble in the job market. "With the unemployment rate at 4.3%, the labor market is softening, which suggests that, left unsupported, it could experience stress," he said, adding last month's easing "moved our policy rate closer to a more neutral stance while maintaining a balanced approach to promoting our dual-mandate objectives." In a press conference after the September FOMC meeting, Fed Chair Jerome Powell hinted at Miran's isolation and said "there wasn’t widespread support at all for a 50-basis-point cut today," noting that policy moves of greater than 25 basis points often happen "when you feel that policy is out of place and needs to move quickly to a new place. That’s not at all what I feel, certainly now."  That said, while Fed Vice Chair for Supervision Michelle Bowman voted for the 25-basis-point cut, she has since argued that Fed policy is at risk of falling behind the curve in offsetting risks to the labor sector.  In his remarks to the television channel, Miran said his longer-run expectations for monetary policy are not dissimilar from other policymakers and "all that's different is the fact that I want to get there a little bit faster."  Miran also shrugged off the risks of cutting rates aggressively at a time when financial markets have been very buoyant and could rise further on cheaper short-term borrowing costs.  "It can be a little bit of a mistake to look at financial conditions and infer something necessarily about the stance of monetary policy, because they can be driven up by other things," Miran said. And he added financial conditions are "not all loose" and housing finance, for example, is "relatively tight."  (Reporting by Michael S. Derby and Dan Burns; Additional reporting by Ann Saphir and Howard Schneider; Editing by Andrea Ricci)

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