US stocks rose on Wednesday on hopes that President Donald Trump’s administration may be making progress on a tax plan.
Trump proposed the biggest tax overhaul in three decades but offered scant details about how to pay for the cuts without dramatically driving up federal deficits, reports Reuters.
The Russell 2000 index of small-cap stocks rose 1.92 per cent and notched its best day since early March. Small-cap names are likely to be the biggest beneficiaries of a tax cut.
Traders now see about a 78 per cent chance of a December rate hike, compared with roughly 73 per cent a week ago, according to CME Group’s FedWatch tool.
Bank of America rose 2.42 per cent and Goldman Sachs gained 2.1 per cent as the biggest boost to the Dow.
The Dow Jones Industrial Average rose 56.39 points, or 0.25 per cent, to 22,340.71, the S&P 500 gained 10.2 points, or 0.41 per cent, to 2,507.04 and the Nasdaq Composite added 73.10 points, or 1.15 per cent, to 6,453.26.
Interest-rate-sensitive and dividend-paying sectors declined. The consumer staples index fell 0.73 per cent while utilities dropped 1.34 per cent and real estate lost 0.84 per cent.
Also serving to cap gains on the Dow and S&P were Nike shares, which declined 1.92 per cent after the company posted its slowest quarterly sales growth in nearly seven years and said it expected a further drop in revenue from North America.
Advancing issues outnumbered declining ones on the NYSE by a 1.29-to-1 ratio; on Nasdaq, a 2.71-to-1 ratio favoured advancers.
About 6.55 billion shares changed hands in US exchanges, compared with the 5.91 billion daily average over the last 20 sessions.