DOW climbed 72 points as Wall Street waits for Trump tax-cut plan
November 24, 2017
U.S. stocks climbed on Wall Street this Monday as tax cuts might keep the economic growth going.
The Dow Jones industrial average rose 72.09 points to close at 23,430.33, together with IBM and Verizon one of the best-performing stocks in the catalog.
The S&P 500 rose 0.1 percent to end the day at 2,582.14, with telephone companies as the best-performing sector. Delphi Automotive and General Motors stocks were one of the best-performing stocks in the index, rising 3.4 percent and 2.3 percent, respectively.
The Nasdaq composite rose 0.1 percent to 6,790.71, just below its record closing high.
Equities also got a boost from strong financial statistics, as leading indicators rose 1.2 percent in October.
Expectations of taxation reform are a positive for stocks this year, since a overhaul could lower corporate taxation. The S&P 500 is up more than 15 percent in 2017.
"Odds are, it is going to succeed. Corporations will not benefit since they've been gaming the tax code to lower their effective tax rate for years. Smaller businesses, but should benefit significantly," said Ed Yardeni, president and chief investment strategist at Yardeni Research.
As doubt around tax reform increased but stocks dropped under some pressure. The S&P 500 and the Dow listed their first losses that were weekly since August.
John Stoltzfus, chief investment strategist at Oppenheimer Asset Management, said that the stock market battles are linked to seasonal factors, such as rebalancing, portfolio spinning and profit-taking.
"While some skeptics and bears seem intent on tying the equity markets' weakness because the start of November to political instability in Washington, we see the current malaise in these markets as regular," Stoltzfus said.
This is going to be a short week for Wall Street since the U.S. stock market will be closed Thursday in observance of the Thanksgiving holiday. Trading volumes typically drop opening the door for moves up.
"This allows the algorithms to get more of an effect on market moves if headlines -- tax or geopolitical reform-related, such as -- catch the market's attention," said Quincy Krosby, chief market strategist at Prudential Financial.
IBM shares gained 1 percentage following Barron's said IBM could gain over 30 percent over the next 12 months. Verizon stocks, meanwhile, gained 1.7 percent after analysts at Wells Fargo updated the stock to outperform from market perform.
Delphi's inventory progressed after financialists at Bank of America Merrill Lynch changed it to buy from neutral. GM strocks also got recognition after its stock was upgraded to buy from neutral.