The Senate and the House took the major reform tax bill a step closer to realisation driving US stocks to record highs. The Senate budget resolution provides for budget reconciliation, which allows Republicans to pass the tax bill through the chamber with a simple majority, thereby avoiding a Democratic filibuster.
Investor hope was fired and the three major averages surged anew on Friday as the much-talked-about tax bill, which could see corporate tax rates slashed, became more distinct. The bull market keeps on building as the Dow marched ever higher closing up +0.71% to 23,328.63 in a broad-based rally with 27 out of 30 members gaining. The S&P 500 rose +0.51% to a record 2,575.71 and tech-heavy Nasdaq climbed +0.36% to 6,629.05.
Reflecting the perception of a stronger economy, the dollar also strengthened. The ICE dollar index, measuring the dollar against a basket of other major currencies, rose +0.50% to $93.73. The euro fell against the dollar -0.64% to $1.1779.
- Dow 23,328.63 +0.71%
- S&P 500 2,572.71 +0.51%
- Nasdaq 6,629.05 +0.36%
- Russell 2000 1,508.81 +0.44%
- NYSE Composite 12,420.09 +0.32%
- Gold 1,282.6 -0.58%
- Oil WTI $51.66 +0.72% (4:00PM EDT)
- 10-Year Treasury 2.381 +0.06%
Winners and losers
Nine out of 11 sectors made gains with only real estate and consumer staples declining. Leaders on the S&P 500 were sports retailer, Under Armour, climbing +6.26% and industrial manufacturer, Dover rose +6.09%.
Among the laggards were biopharmaceutical, Celgene Corp pitched -10.76% and consumer goods company, Procter & Gamble fell -3.65%.
In a surprise turnaround, GE saw its stock price rise +1.07% after its new CEO, John Flannery, cut forecasts for 2017 cash flow by half from its projection in July and lowered its earnings targets He also said the company would exit around $20bn in businesses.
In early trading the stock fell as much as -7%. According to Dow Jones, Flannery said in a conference call on Friday, "Our results are unacceptable to say the least," adding that "Things will not stay the same at GE."
Flannery, took over from Jeffrey Immelt in August and has made it a priority to reduce costs and "rethink the sprawling company".