Dow posts biggest gain in 3 months on tax overhaul optimism
By Adam Shell
November 28, 2017
The Dow posted its biggest gain since early September amid rising optimism that a tax cut bill is moving closer to reality.
In a sign that the promised tax overhaul from President Trump — which includes a massive reduction in the corporate tax rate and lower taxes for most individual filers — is not currently fully priced into the stock market, the Dow Jones industrial average rose 256 points, or 1.1%, Tuesday to close at a record high of 23,836.71.
It was the Dow’s best daily gain since a 260 point rise on Sept. 11.
The stock price surge, which also included record highs for the Standard & Poor’s 500 stock index, the Nasdaq composite and the small-company Russell 2000, was fueled by news that the Senate Budget Committee cleared the current version of the Republican-led tax bill in a 12-11 vote.
The tax plan is viewed by investors as the centerpiece of Trump’s economic stimulus initiatives, as lower taxes for businesses and individuals is seen as boosting the economy, corporate earnings and consumer spending.
The biggest winners of the day were small-company stocks, as they are domestically focused and will benefit most from lower tax rates.