By Sara Sjolin and Anora Mahmudova, MarketWatch
Procter & Gamble, Boeing earnings disappoint
U.S. stocks switched between gains and losses on Wednesday as
investors remained skittish ahead of an announcement from President
Donald Trump's administration's on taxes.
Early gains, however, were still enough to help the Nasdaq
Composite Index to touch an intraday all-time high at 6,039.28, a
day after the tech-laden index surpassed the psychologically
important level of 6,000 for the first time ever.
The S&P 500 index briefly traded above its previous closing
high set March 1, but pared back to trade up 4 points, or 0.2%, at
2,392. Health-care, telecom and energy shares were leading gains,
while the consumer-staple and real-estate sectors were the only
ones trading lower. Energy shares rebounded, following higher oil
prices.
The Dow Jones Industrial Average advanced 45 points, or 0.2%, to
21,042, despite disappointing first-quarter earnings from Dow
components, Procter & Gamble Co
(http://www.marketwatch.com/story/pg-earnings-beat-expectations-but-revenue-misses-2017-04-26).(PG)
and Boeing Co
(http://www.marketwatch.com/story/boeing-shares-fall-premarket-after-revenue-falls-short-of-estimates-2017-04-26).(BA),
which fell after each missed on revenue forecasts.
The Nasdaq was most recently trading flat at 6,028.
The anxious trading atmosphere comes after stocks on Tuesday
climbed sharply higher
(http://www.marketwatch.com/story/us-stocks-poised-to-build-on-rally-with-flood-of-earnings-ahead-2017-04-25),
on the back of upbeat earnings and the possibility of significant
corporate tax cuts
(http://www.marketwatch.com/story/trumps-15-corporate-tax-rate-could-cost-the-government-2-trillion-2017-04-25).
"Nobody is expecting anything other than a broad outline of the
tax reform, but that will have more clarity than the previously
vague description like 'massive' or 'phenomenal'," said Quincy
Krosby, market strategist, at Prudential Financial.
Krosby noted that earnings, especially revenue growth has been
underpinning the market as well as optimism about tax reform.
Trump won't present the tax announcement himself, but will leave
it to Treasury Steven Mnuchin and National Economic Director Gary
Cohn, according to media reports
(http://thehill.com/policy/finance/330588-mnuchin-cohn-expected-to-roll-out-trump-tax-plan).
The press briefing at the White House is scheduled for 1:30 p.m.
Eastern Time.
Mnuchin, on CNBC before the market open confirmed that the White
House tax plan will include a 15% corporate tax rate, describing
the planned overhaul as the biggest tax cut in history.
Read:Trump's tax reform could lift the stock-market to new
heights
(http://www.marketwatch.com/story/trumps-tax-reform-could-lift-the-stock-market-to-new-heights-2017-04-26)
Promises of a tax plan have been one of the linchpins of recent
gains for risk assets and is likely to be a significant driver of
trading action across asset classes when the blueprint of the plan
is released later.
"We will be closely watching the dollar and Treasury yields
after the tax plan unveiled," Krosby said.
The dollar traded mostly higher against other major currencies
ahead of the announcement on Wednesday, with the ICE Dollar Index
up 0.4% at 99.177. The yield on the 10-year Treasury note fell 1
basis point to 2.32%.
Some are anticipated a more muted reaction to any tax
announcement, citing Trump's recent struggles getting a bill to
rework Obamacare to a House vote.
"Given the failure in the first 100 days to get anything
accomplished legislatively, I doubt Wall Street is going to go out
and party on the assumption that Republicans will be able to
translate today's wish list into tomorrow's legislation," wrote
James Meyer, chief investment officer at Tower Bridge Advisors in a
note.
Also in focus was a potential government shutdown this weekend.
Some of those concerns, however, may have eased after Trump backed
off on a demand for funding for a wall between the U.S.-Mexico
border
(http://www.marketwatch.com/story/trump-backs-off-demand-for-immediate-border-wall-funding-2017-04-24).
See:Should Wall Street fear a government shutdown? Here's how
stocks fared in the past
(http://www.marketwatch.com/story/should-wall-street-fear-a-government-shutdown-heres-how-stocks-fared-during-past-closures-2017-04-21)
Earnings season: The season continues in full swing, with a
deluge of results. Shares of PepsiCo Inc.(PEP)fell 1.8% even as
earnings beat analyst forecast.
Anthem Inc.(ANTM) shares rose 2.8% after results topped
expectations.
Twitter Inc. (TWTR) soared 10%
(http://www.marketwatch.com/story/twitter-shares-soar-after-first-quarter-earnings-beat-2017-04-26),
after the social media company beat first-quarter earnings
expectations.
Shares of Chipotle Mexican Grill Inc.(CMG) rose 4.9% after the
casual restaurant chain reported first-quarter earnings ahead of
forecasts late Tuesday
(http://www.marketwatch.com/story/chipotle-shares-rally-6-after-companys-earnings-beat-2017-04-25).
Arconic Inc. (ARNC) shares rallied 2.3% after the aerospace and
car maker supplier's earnings out late Tuesday topped Wall Street
estimates
(http://www.marketwatch.com/story/arconic-shares-rally-as-quarterly-earnings-beat-street-view-2017-04-25).
After the market closes, earnings from Amgen Inc.(AMGN), Tractor
Supply Co.(TSCO) and PayPal Holdings Inc.(PYPL) are on tap.
Other markets:Stocks in Asia closed mainly higher
(http://www.marketwatch.com/story/asia-pacific-markets-continue-to-ride-wave-of-gains-2017-04-25),
propelled by optimism over the prospect of a U.S. tax overhaul.
European markets were slightly lower
(http://www.marketwatch.com/story/european-stocks-struggle-to-hold-onto-20-month-high-ahead-of-trump-tax-unveiling-2017-04-26),
after surging to historic highs following the first round of the
French presidential election on Sunday. Centrist Emmanuel Macron
came out on top and will battle against far-right Marine Le Pen in
the second round on May 7--a vote Macron is expected to win.
Read:Emmanuel Macron: 5 things to know about the man poised to
be France's president
(http://www.marketwatch.com/story/emmanuel-macron-5-things-to-know-about-the-man-poised-to-be-frances-president-2017-04-24)
Oil prices
(http://www.marketwatch.com/story/oil-prices-slip-again-as-us-supply-worries-resurface-2017-04-26-11033520)
were lower ahead of the U.S. Energy Information Administration's
supply data out later on Wednesday.
Meanwhile, gold prices down 0.3%.
(END) Dow Jones Newswires
April 26, 2017 12:09 ET (16:09 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.