While you were sleeping: Tax overhaul optimism boosts Wall St

Friday 1st December 2017

Wall Street rallied, sending the Dow and S&P 500 to record highs, amid signs that the Trump administration is moving a step closer to delivering on its tax reform promise.

In 1.18pm trading in New York, the Dow Jones Industrial Average rallied 1.4 percent, while the Nasdaq Composite Index climbed 0.8 percent. In 1.03pm trading, the Standard & Poor’s 500 Index gained 1.1 percent.

The Dow climbed to a record 24,327.82 while the S&P 500 touched a record 2,657.74.

“The market is beginning to price in a higher certainty of tax reform happening and that is the big driver today,” Mark Heppenstall, chief investment officer at Penn Mutual Asset Management in Horsham, Pennsylvania, told Reuters.

The Dow moved higher, led by advances in shares of Goldman Sachs and those of United Technologies, recently up 3.7 percent and 2.7 percent respectively.

Bucking the trend, shares of General Electric and those of Johnson & Johnson fell, recently down 0.9 percent and 0.3 percent respectively, for the only declining stocks in the Dow.

Shares of Kroger jumped after the supermarket chain reported third-quarter sales and earnings that exceeded analysts expectations, offering optimism it can stave off intensifying industry competition.

“Based on the wall of worry over Amazon, Walmart and Aldi, fundamental concerns over Kroger’s competitive position proved to be overblown,” Pivotal Research Group analyst Ajay Jain told Reuters, noting that the company’s year-over-year earnings in the period improved for the first time in four quarters.

Shares of Kroger traded 9.4 percent higher as of 12.18pm trading in New York.

"Restock Kroger is off to a great start," CEO Rodney McMullen said in a statement. "Customers are recognising our efforts to redefine the customer experience and rewarding us with their loyalty. We continue to accelerate our digital and ecommerce offerings, to grow our brands, to lower prices for customers, and to invest in our associates.

“We had our best ever Black Friday results for general merchandise, led by record sales at Fred Meyer,” McMullen noted. "We remain confident in our ability to continue to grow identical supermarket store sales and market share for the balance of the year and in 2018.”

In Europe, the Stoxx 600 Index finished the day with a 0.3 percent decline from the previous close. Germany’s DAX Index fell 0.3 percent, while France’s CAC 40 Index dropped 0.5 percent, and the UK’s FTSE 100 Index gave up 0.9 percent.

Meanwhile, oil prices slid after OPEC and other top producers including Russia extended an agreement to curb their output to the end of 2018 in an effort to reduce the global glut.

(BusinessDesk)

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