Senate Republicans Approve Tax Vote!
The Republicans finally seemed to get their act together, the Senate Budging Committee narrowly voting to advance the upper house’s tax bill. The catalyst? Two Republicans changed their votes to a “yes,” with a full Senate vote coming as soon as Thursday. Even though indexes ended at record highs, there was a blip along the way, though: “The Fatty.”
After North Korea’s leader, Kim Jong Un, otherwise known as “The Fatty”, announced that he launched an intercontinental ballistic missile that could strike “the whole mainland of the U.S.,” stocks pared early gains. The first strike in some two months, investors got spooked by the geopolitical tensions. The fear, though, didn’t last long, news breaking shortly thereafter that Republican’s tax proposal had moved a step closer to a Senate vote.
Market Summary: The blue chip, Dow, ended up 1.09%, the S&P 500 gaining 0.98%. The NASDAQ edged up 0.49%.
The Fed, too, served to help drive the market higher. Trump’s pick for new Fed chief, Jerome Powell, testified at a Senate confirmation hearing. While accentuating his credentials as a 5-year member of the FOMC committee, he stated that he hopes to continue in the vein of the reigning chief, Janet Yellen. As far as monetary policy specifics, he commented that he sees a December rate hike “coming together.” With investors and traders alike parsing his words, two words in particular gave the financial sector a boost. They were “tough enough,” Powell commenting that he saw the current regulations on the financial sector as just that, “tough enough.”
Banks reveled in the positive attention, the SPDR S&P Bank ETF (KBE) rising 3.2%. Bank of America (BAC) jumped 4%, Citigroup tacking on 3.2%. Navient Corp. (NAVI) surged 4.01%. Wells Fargo (WFC), shot up 3%, despite earlier reports that it had overcharged foreign-exchange clients. Every component on the KBE rose on the day.
Phoenix Financial Services chief market analyst, Wayne Kaufman, is certainly bullish: “This is a strong market that continues to grind up, and I expect the market will continue to move higher throughout the end of the year. The market is very comfortable with valuations here, and so long as earnings continue to move up, I don’t see that changing.”
Bitcoin also had a field day, rising past $10,000, speculation running rampant, along with equal concerns that we’re talking about just another bubble; from tulip bubbles to the dot-com bubble, skeptics alike say that the lights are going to go out, the bubble imploding in turn.
The stocks that saw outstanding movement, likewise included Buffalo Wild Wings (BWLD), which soared 6.3% after Arby’s Restaurant Group (owned by private equity group, Roark Capital) agreed to purchase the company for $157 a share. The deal, including debt, is valued at $2.9 billion.
On the macro front, despite all the geopolitical tensions out and about and the political wrangling, Consumer Confidence in November rose to a 17-year high. The U.S. National Home Price NSA Index jumped 6.2% in September, based on the S&P CoreLogic Case-Shiller.
Today’s Economic Calendar: The second reading for Q3 GDP is expected to be released at 8:30, Janet Yellen speaking at 10:00. Also at 10:00, be primed for pending home sales numbers, with the EIA Petroleum report coming out thereafter at 10:30. Then at 14:00, the Fed Beige Book will be released.
Wednesday’s Hot Stocks: ADSK, MRVL, NUAN, WESCO AIR
|Monday||10:00||New Home Sales||620 K||Medium|
|Tuesday||9:00||FHFA House Price Index||0.6 %||Medium|
|Tuesday||9:00||S&P Case-Shiller||0.4 %||Medium|
|Tuesday||10:00||Consumer Confidence||240 K||High|
|Tuesday||10:00||Jerome Powell Speaks||–||High|
|Wednesday||10:00||Janet Yellen Speaks||–||High|
|Wednesday||10:00||Pending Home Sales Index||1.0 %||Medium|
|Thursday||8:30||Jobless Claims||240 K||Medium|
|Thursday||8:30||Personal Income and Outlays||0.3 %||Medium|
|Friday||9:45||PMI Manufacturing Index||54.5||Medium|
|Friday||10:00||ISM Mfg Index||58.4||High|
|Friday||10:00||Construction Spending||0.5 %||Medium|
|TECD||Tech Data Corporation||PM||Monday|
|MRVL||Marvell Technology Group Ltd.||PM||Tuesday|
|PSTG||Pure Storage, Inc.||PM||Tuesday|
|NUAN||Nuance Communications, Inc.||PM||Tuesday|
|TIF||Tiffany & Co.||AM||Wednesday|
|RY||Royal Bank of Canada||AM||Wednesday|
|GWRE||Guidewire Software, Inc.||PM||Wednesday|
|JACK||Jack in the Box Inc.||PM||Wednesday|
|GLNG||Golar LNG Limited||AM||Thursday|
|DCI||Donaldson Company, Inc.||AM||Thursday|
|KR||The Kroger Co.||AM||Thursday|
|ULTA||Ulta Beauty, Inc.||PM||Thursday|
|FIVE||Five Below, Inc.||PM||Thursday|
|BIG||Big Lots, Inc.||AM||Friday|
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