US stocks ended Thursday’s session muted as the three major benchmark indexes declined under the weight of a policy decision on internet neutrality rules and rising dissent around the Republican tax reform bill.
The indexes' pared earlier gains, which stuttered by afternoon as the indexes declined broadly. Gains in tech and consumer discretionary were outweighed by losses in healthcare and financials. The Dow Jones Industrial Average fell 75 points or -0.17%. The S&P 500 dipped 11 points or -0.41% and NASDAQ fell 17 points or -0.25%. Walt Disney surged +3% on its deal to buy 21st Century Fox's (up +6%) assets for $52.4bn in stock. Pulling along other media companies like Netflix which rose +2% and Comcast up +1.43%.
News reports wrote of the death of internet freedom after the Federal Communication Commission voted to remove the net neutrality rules, which dictate how internet-service providers can treat traffic on their networks. It’s a move widely seen by its critics as giving significant and extraordinary advantage to cable and wireless providers to do what they want when it comes to controlling traffic and with many owning content companies concerns they are likely to be anticompetitive.
• Dow 24,510.11 +0.31%
• S&P 500 2,652.09 -0.41%
• NASDAQ 6,856.53 -0.25%
• Russell 2000 1,508.09 -1.08%
• NYSE Composite 12,639.43 -0.47%
• Gold 1,255.3 +0.54%
• Oil WTI $57.11 +0.92% (4:02PM EST)
• 10-Year Treasury 2.351 -0.07%
Game of tax
The US Republican tax reform plan may have hit a stumbling block after Senator Marco Rubio said he would withhold his vote on the tax bill unless a larger child tax credit was agreed.
With a slender majority to enact the sweeping tax reform bill, investors are likely to remain focused on lkey developments with Republicans who remain tentative at this stage.
Rubio's statement caused some market jitters sending them lower with small caps index (small caps are seen as beneficiaries of tax cuts) Russell 2000 falling -1.08%.
Rubio told reporters, “I can’t in good conscience support it unless we are able to increase the refundable portion of it, and there’s way to do it, and we’ll be very reasonable.”
Finally in other markets, the dollar index rose on strong US retail sales data which was above expectations. The US Dollar Index which measures against a basket of other currencies rose +0.18% to 93.63. Gold also strengthened up +0.54% to $1,255 per ounce.