Friday, 24 March 2017
Bank stocks push Wall St. higher; healthcare vote in focus
U.S. stocks rose in early afternoon trading on Thursday as investors snapped up beaten-down bank stocks ahead of a vote on a healthcare bill that is seen as President Donald Trump's first policy test.
Failure to pass the legislation, called the American Health Care Act, would cast doubt on Trump's ability to deliver other parts of his agenda that need the cooperation of the Republican-controlled Congress, including ambitious plans to overhaul the tax code and invest in infrastructure.
The House vote had been expected by about 7 p.m ET but there were signs the deadline could be pushed back.
"There's been a lot of optimism regarding the Trump administration so this could very well be the first setback," said Erik Davidson, chief investment officer at Wells Fargo Private Bank in San Francisco.
"What the market wants is to get through the healthcare question so that we can move on to tax reform."
The S&P 500 has gained 10 percent since the election, spurred mainly by Trump's campaign promises to enact legislation that are seen as pro-business.
The benchmark index is trading at about 18 times expected forward earnings, compared with a 10-year average of 14, according to Thomson Reuters data.
At 12:45 p.m. ET the Dow Jones Industrial Average .DJI was up 83.9 points, or 0.41 percent, at 20,745.2, the S&P 500 .SPX was up 8.91 points, or 0.37 percent, at 2,357.36.
The Nasdaq Composite .IXIC was up 16.20 points, or 0.28 percent, at 5,837.84.
Ten of the 11 major S&P indexes were higher, with the financial index's .SPSY 1 percent rise leading the advancers.
The sector, which had its worst one-day fall since June on Tuesday, has risen the most since the election.
Bank of America's 1.6 percent rise lifted the S&P, while Goldman Sachs' 1.1 percent increase helped push the Dow higher.
Google-parent Alphabet fell 1.1 percent to $840.09 as more firms pull YouTube ads on fears they may have appeared alongside offensive videos. The stock was the biggest drag on the S&P and the Nasdaq.
Five Below rose 12.1 percent to $42.73 after the retailer's quarterly earnings beat estimates.
Accenture fell 3.8 percent to $121.66 after the consulting and outsourcing services provider's quarterly profit slipped.
Advancing issues outnumbered decliners on the NYSE by 2,266 to 608. On the Nasdaq, 2,011 issues rose and 746 fell.
The S&P 500 index showed 14 new 52-week highs and one new low, while the Nasdaq recorded 43 new highs and 33 new lows.
Reference: Tanya Agrawal