MARKET SNAPSHOT: Stock Indexes Edge Higher As Tax Overhaul Looms Over Market

By Sara Sjolin and Anora M. Gaudiano, MarketWatch Features Dow Jones Newswires

Broadcom rallies after results

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The main U.S. stock benchmarks edged higher in early Thursday trade, driven by gains in the technology, industrials and materials sectors.

Traders focused on continued progress on tax legislation and looked ahead to the monthly jobs report due Friday.

What are indexes doing?

The S&P 500 index was up by 5 points, or 0.2%, to 2,634, after four straight sessions of declines. Eight of the 11 main sectors were trading higher, led by gains in the industrials sector.

The Dow Jones Industrial Average added 51 points, or 0.2%, to 24,193.

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The tech-heavy Nasdaq Composite Index outpaced the other benchmarks and was up 37 points, or 0.5%, at 6,812, largely thanks to gains among so-called FAANG stocks: Apple Inc.(AAPL) was up 0.8%, while Alphabet Inc.(GOOGL) rose 0.9%.

What's driving the markets?

Tech stocks were making something of a comeback after taking a battering earlier this week. From Friday through Tuesday, the tech-heavy Nasdaq fell 1.6%, with analysts largely blaming the drop on profit-taking after a big rally and on concerns about how the U.S. tax overhaul will impact the tech sector.

Both the House and Senate have passed their own versions of the tax bill and now the two need to bridge their differences and agree on a final bill for President Donald Trump to sign. The Republican-led Senate late Wednesday agreed to begin formal negotiations (https://www.wsj.com/articles/senate-votes-to-begin-tax-overhaul-negotiations-with-house-1512609708) with the House, spurring hopes the final tax overhaul will be completed by a self-imposed deadline of Dec. 22.

Another reason for eyes to turn to Washington was the potential for a U.S. government shutdown. Trump is scheduled to meet congressional leaders on Thursday to discuss a bill to keep the government open. A bill to avoid a shutdown will also be up for a vote in the House on Thursday, after the House Rules Committee on Wednesday put together a temporary funding package.

Read:Here's how the stock market has handled past government shutdowns (http://www.marketwatch.com/story/heres-how-the-stock-market-has-handled-past-government-shutdowns-2017-12-06)

Investors were also looking ahead to the closely watched nonfarm payrolls report out on Friday.

What are strategists saying?

"It's not unusual for investors to move away from tech stocks that had done exceptionally well this year and into the losing sectors, such as retail. But that rotation seems to be not very serious at this point," said Maris Ogg, president at Tower Bridge Advisors.

"We don't think the tech sector is that expensive and as long as they can grow their earnings, their prices should be sustained," Ogg said.

Which stocks are in focus?

Dollar General Corp.(DG) rose 3.4% after the dollar-store operator posted revenue that topped expectations.

Shares of Broadcom Ltd.(AVGO) climbed 2.2% after the company reported earnings that topped Wall Street estimates (http://www.marketwatch.com/story/broadcom-shares-shaky-after-earnings-beat-2017-12-06) late Wednesday.

Lululemon Athletica Inc.(LULU) rallied 6.8% after the apparel retailer late Wednesday reported third-quarter earnings and sales above estimates (http://www.marketwatch.com/story/lululemon-shares-jump-on-earnings-sales-beat-2017-12-06).

Okta Inc.(OKTA) shares rose 2% after the identity-management company late Wednesday posted quarterly results that beat forecasts (http://www.marketwatch.com/story/okta-shares-rally-as-results-top-street-revenue-rises-faster-than-sales-expenses-2017-12-06).

Citigroup Inc.(C) shares were down 0.8% after the bank said late Wednesday it's likely to take a $20 billion hit to profits (http://www.marketwatch.com/story/citigroup-likely-to-take-20-billion-hit-from-republicans-tax-plan-2017-12-07) under the new tax plans passed by Congress.

LendingClub Corp.(LC) , shares tumbled 16.4% after the company lowered its outlook for the fourth quarter and delivered a lower-than-expected forecast for next year.

What's on the docket?

Initial U.S. jobless claims (http://www.marketwatch.com/story/us-jobless-claims-fall-to-5-week-low-of-236000-2017-12-07), a way to measure layoffs, fell by 2,000 to 236,000 in the seven days ended Dec 2. Economists surveyed by MarketWatch had forecast claims to total 240,000.

Consumer credit for October is on the docket at 3 p.m. Eastern.

What are other markets doing?

Asian stocks closed mixed, while European equities mostly traded higher (http://www.marketwatch.com/story/european-stocks-on-course-to-break-losing-streak-as-betting-shares-catch-a-bid-2017-12-07) in the early going.

The ICE Dollar Index was up 0.1% at 93.718, rising for a fourth straight session.

Oil futures rebounded, rising 0.5%, while gold prices dropped 0.8%.

Bitcoin continued its rally, breaking through $15,000 (http://www.marketwatch.com/story/bitcoin-blasts-through-15000-milestone-soars-20-in-24-hours-2017-12-07), just a day after topping the $14,000 level (http://www.marketwatch.com/story/bitcoin-hitting-new-records-tops-200-billion-in-market-capitalization-2017-12-05) for the first time.

(END) Dow Jones Newswires

December 07, 2017 11:06 ET (16:06 GMT)