Stock indexes bolted ahead at the opening bell Thursday and were up solidly at midday.
The Nasdaq gripped a 1.2% gain, while the S&P 500 added 0.7%. The blue-chip Dow Jones industrial average rose 0.8%. Small caps headed north, with the Russell 2000 up 1.4%.
Volume in the stock market today was down on both major exchanges. Falling volume as prices rise is not what the bulls prefer to see.
Although many financial reports were released today, the Republican tax plan also colored the day’s action. The U.S. House is expected to vote early in the afternoon. The bill would cut taxes by $1.4 trillion over 10 years. The corporate tax rate would be slashed from 35% to 20%.
Even if the legislation clears the House, a different version is alive in the U.S. Senate. The Senate isn’t likely to vote on the bill until after Thanksgiving. If the bill passes, then the House and Senate versions must be reconciled.
In the stock market, big gainers were widespread.
Seven stocks in the 30-component Dow Jones industrial average were up 1% or more. The seven were Wal-Mart Stores (WMT), up 8%; Cisco Systems (CSCO), up 6%; Caterpillar (CAT), up 2%; and Apple (AAPL), Goldman Sachs (GS), DowDuPont (DOW) and Procter & Gamble (PG), each up 1%.
Cisco is at its highest stock price since February 2001. Over the past 16 years, Cisco has repeatedly found resistance in the low to mid-30s. Market watchers will be monitoring the stock to see if it can break the old pattern.
Losers were scarce Thursday, but there were a few. The Dow Jones utility average retreated 0.4%. The consumer electronics group dropped 1.7%. Within consumer electronics, Best Buy (BBY) stumbled 6%. Best Buy’s fiscal third-quarter earnings gain of 30% to 78 cents a share matched the Street’s consensus view, but revenue and guidance were weaker than expected.
Best Buy is finding support at the long-term 200-day moving average.
First-time jobless claims rolled in at 249,000, worse than the 236,000 expected.
The Philadelphia Federal Reserve manufacturing gauge fell to 22.7 in November. This was below October’s 27.9, under the consensus estimate of 25 and below the lowest estimate in the range.
Industrial production in October rose 0.9% vs. views for a 0.5% gain.
The National Association of Home Builders released its housing market index for November. The reading came in at 70, above the consensus estimate for 67.
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