April 23, 2018, 12:37 am
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Tax plan optimism propels Wall St. to record highs

NEW YORK- Wall Street hit record closing highs on Monday as optimism increased about the likelihood of lower corporate tax rates as the Republican tax bill moved closer to passage.

The Nasdaq surpassed the 7,000-point mark during the session but closed below that level.

The Republican-controlled US Congress is expected to begin voting on sweeping tax legislation on Tuesday, aiming to get the bill to President Donald Trump to sign into law by the end of the week. Republican US Senator Susan Collins said she would vote for the sweeping overhaul, all but ensuring its passage. 

“This Congress has shown an inability to pass anything over the past five years,” said Michael O’Rourke, chief market strategist at JonesTrading in Greenwich, Connecticut. “If a major piece of legislation is passed, you’d expect the markets to be happy.”

US stocks have enjoyed a near year-long rally, with the benchmark S&P 500 and the blue-chip Dow Jones Industrial Average set for their best year since 2013.

The bill would cut corporate tax rates to 21 percent from 35 percent, which investors are betting will boost profits as well as trigger share buybacks and higher dividend payouts.

Another expected outcome of lower taxes is cash repatriation, which market analysts say could boost mergers and acquisitions.

“A lot of the things in the tax proposal are better for stocks than anything else,” said Rob Stein, chief executive officer of Astor Investment Management in Chicago.

The Dow Jones Industrial Average rose 140.46 points, or 0.57 percent, to 24,792.2, the S&P 500 gained 14.36 points, or 0.54 percent, to 2,690.17 and the Nasdaq Composite added 58.18 points, or 0.84 percent, to 6,994.76. – Reuters 
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