The Trump administration’s budget office told FOX Business Wednesday that it is canceling $1.5 billion in blue-state grants, citing concerns about how funds are being managed in California, Colorado, Illinois and Minnesota.

The Office of Management and Budget (OMB) said it will target projects at the Department of Transportation (DOT) and the Centers for Disease Control and Prevention (CDC), cutting $943 million and $602 million, respectively.

An OMB spokesperson told the New York Post that the states were being targeted due to “waste and mismanagement” of taxpayer funds.

The announcement follows OMB launching a sweeping review of federal funding for several Democratic-led states in January, which required states to submit detailed receipts proving no funds were being mishandled, CBS News reported.

TRUMP’S ENERGY DEPARTMENT AXES BIDEN-ERA PROJECTS, SAVING TAXPAYERS $7.56B

The initiative reflects a shift in fiscal policy toward “America First” priorities by withholding funds from states that maintain sanctuary policies or projects the administration deems wasteful. 

Concerns cited include tax support for illegal immigrants, green initiatives and alleged fraud in certain states, such as the $250 million COVID-era scam in Minnesota uncovered in the “Feeding Our Future” case.

Several DOT and CDC programs in blue states could be affected by the funding cuts, including equity-focused infrastructure projects and public health initiatives the OMB previously criticized as “social engineering” rather than legitimate public health efforts. 

“The use of Federal resources to advance Marxist equity, transgenderism, and Green New Deal social engineering policies is a waste of taxpayer dollars that does not improve the day-to-day lives of those we serve,” the OMB previously said in 2025. 

TREASURY SECRETARY ANNOUNCES CASH REWARDS FOR MINNESOTA FRAUD WHISTLEBLOWERS

In January, Trump halted more than $10 billion in federal childcare and social services funding to four states, as well as New York, over concerns that some benefits had been fraudulently funneled to noncitizens, the Post reported. 

In California, San Francisco was slated to receive $15 million to expand its electric vehicle charging network, with a focus on “disadvantaged communities that are marginalized by underinvestment and overburdened by pollution,” city officials said in 2025. 

Similarly, the California Reducing Disparities Project, an equity-focused public health program serving marginalized communities, including racial minorities and LGBTQ+ populations, was awarded $60 million over six years.

Chicago has drawn scrutiny for its initiatives focused on diversity, equity and inclusion. 

The Biden-era Red Line Extension and the Red and Purple Modernization Programs, which together total approximately $2.1 billion, were paused in 2025 pending a review of “race-based contracting” practices.

DEMS’ DHS SHUTDOWN THREAT WOULD HIT FEMA, TSA WHILE IMMIGRATION FUNDING REMAINS INTACT

Additionally, funding for CDC research on sexually transmitted diseases affecting “adolescents and young adults, gay, bisexual, and other men who have sex with men” may be subject to potential cuts. The project, which listed Chicago as a recipient, was in line to receive $7 million, The Post reported.

In October 2025, the Trump administration labeled federal funding for various climate and renewable energy initiatives as a “Green New Scam” and subsequently terminated or paused $7 billion in grants, with Colorado among the primarily affected states, according to local media CPR News. 

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The Trump administration may expand grant cancellations in the future amid concerns about systemic failures in sanctuary city leadership, which surfaced prominently following Minnesota’s fraud schemes.

The governors of California, Colorado, Illinois and Minnesota did not immediately respond to FOX Business’ request for comment.

Fox News Digital’s Greg Norman contributed to this report. 

Shares of Information Technology companies tumbled on Wednesday, as the ripple effects of a heavy overnight sell-off in their US counterparts, sparked by the launch of Anthropic’s legal AI tool, reverberated across traditional software services stocks.

The Nifty IT index fell 5.9% on Wednesday, in its worst performance since the peak of the Covid selloff in March 2020, leading to a market cap erosion of ₹1.9 lakh crore in the Indian IT pack.

“The sell-off has been triggered by market concerns that Anthropic’s new automation tools could replace currently outsourced IT services, leading to margin pressure for Indian IT companies,” said Vinod Nair, head of Research, Geojit Investments.

The San Francisco-based AI company’s new tool — Claude Cowork, an open-source plugin, is designed to automate tasks across legal, sales, marketing and data analysis.

Nair said automation tools from companies like Anthropic are viewed as a challenge to traditional IT service models.
After the launch announcement, US-based stocks Accenture, Microsoft, Cognizant and Salesforce fell 310% while American Depository Receipts (ADRs) of Infosys and Wipro fell 5.6% and 4.8%, respectively, in the US on Tuesday.
At home, Infosys fell the most, down 7.4%, followed by TCS, which declined 7%. The rest of all stocks on the Nifty IT index were down 3.8-6%.
The benchmark Nifty ended 0.2% higher at 25,776.

Sagar Shetty, research analyst at StoxBox said Wednesday’s sell-off was largely a knee-jerk reaction.

“At this stage, unless we see a clear and material impact on revenues, we don’t see any immediate reason to worry about large-scale disruption to the industry,” he said.

Nifty IT index advanced 1.4% in Tuesday’s trading after the finalisation of the India-US trade deal. Though Indian IT companies were not directly impacted by the tariffs, caution over business demand in the US had weighed on sentiment.

SHORT-TERM WORRIES, LONG-TERM STABILITY
Nair said Indian IT stocks are experiencing sentiment-driven volatility amid concerns about AI disruption, though underlying fundamentals remain stable.

“At this stage, long-term investors may selectively accumulate high-quality IT names with strong client stickiness and solid balance sheets. It is important, however, to monitor deal win trends over the next few quarters to assess any impact from AI adoption,” he said.
Shetty also said while near-term volatility may persist, deal momentum remains healthy, and the longer-term outlook for software
services remains constructive.

“We remain positive on the adaptation capabilities of Indian IT players, as the revenue model shifts from headcount-led, timeand-material billing to an AI-driven, outcome-based model,” he said.

Shetty remains bullish on Infosys, HCL Tech, Coforge and Persistent, and sees dips as good buying opportunities.

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Arm Holdings plc (ARM) Q3 2026 Earnings Call February 4, 2026 5:00 PM EST

Company Participants

Jeffrey Kvaal – VP & Head of Investor Relations
Rene Haas – CEO & Director
Jason Child – Executive VP & CFO

Conference Call Participants

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Joseph Quatrochi – Wells Fargo Securities, LLC, Research Division
Simon Leopold – Raymond James & Associates, Inc., Research Division
Vivek Arya – BofA Securities, Research Division
Mehdi Hosseini – Susquehanna Financial Group, LLLP, Research Division
Vijay Rakesh – Mizuho Securities USA LLC, Research Division
Sreekrishnan Sankarnarayanan – TD Cowen, Research Division
Harlan Sur – JPMorgan Chase & Co, Research Division
Yu Shi – Needham & Company, LLC, Research Division
Srinivas Pajjuri – RBC Capital Markets, Research Division
Andrew Gardiner – Citigroup Inc., Research Division
John DiFucci – Guggenheim Securities, LLC, Research Division
Timm Schulze-Melander – Rothschild & Co Redburn, Research Division

Presentation

Operator

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Good day, and thank you for standing by. Welcome to the Arm Third Quarter Fiscal Year 2026 Webcast and Conference Call. [Operator Instructions] Please be advised that today’s conference is being recorded.

I would now like to hand the conference over to your first speaker today, Jeff Kvaal, Head of Investor Relations. Please go ahead.

Jeffrey Kvaal
VP & Head of Investor Relations

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Thank you very much, and welcome to our third quarter fiscal ’26 earnings call. On the call are Rene Haas, Arm’s Chief Executive Officer; and Jason Child, Arm’s Chief Financial Officer.

During the call, Arm will discuss forecasts, targets and other forward-looking information about the company and its financial results. All of these statements represent our best current judgment about future results. Our business is subject to many risks and uncertainties that could cause actual results to differ materially. In addition to any risks that we highlight during this call, important risk factors that may affect our future results and performance are described in our registration statement on Form 20-F

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The Securities and Exchange Board of India (Sebi) has proposed to change the ‘fit and proper person’ criteria for market intermediaries including stockbrokers, in a move to reduce compliance burden for entities facing legal proceedings.

The regulator has suggested to remove automatic disqualification of individuals holding key positions on filing of an FIR (first information report) or a charge sheet in economic offence cases.

“It has been represented that mere pendency of criminal complaint or FIR or filing of charge sheet should not trigger disqualification, as filing of such criminal complaint or FIR or charge sheet are the preliminary steps to set the criminal law into motion. The same is also stated to be against the settled principle of criminal law that all persons are innocent until proven guilty,” Sebi said in a discussion paper on Wednesday.

The move comes after the regulator submitted before the Bombay High Court that it would review its rules on ‘fit on proper person’ after brokers involved in the National Spot Exchange (NSEL) case, including Anand Rathi Commodities and Motilal Oswal, challenged a Sebi order declaring them ‘not fit and proper’ to operate.

These brokers argued that disqualification merely on allegations was a violation of their constitutional rights.

As per current rules, intermediaries, key managerial personnel and persons in control incur a disqualification if there is a pending criminal complaint or FIR filed by Sebi or a pending charge sheet concerning economic offences by an enforcement agency.
The regulator has now proposed that a rule-based formula may be onerous and not appropriate as it could lead to unintended consequences such as putting a person at a disadvantageous position at a preliminary stage of pending criminal complaint or charge sheet, which could later result in acquittal or discharge.This may also be counterproductive to the objective of promoting ease of doing business, it said.

Any serious or incriminating factor may be taken into account on a case-to-case basis in the context of the person’s overall conduct and the potential risk to the interests of the investors, Sebi said.

The regulator said it would come out with guidelines regarding cases where pendency of criminal proceedings is egregious enough to incur disqualification.