Euro stays above $1.18
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European stock markets dropped for a second straight day on Wednesday, with some pre-holiday profit taking kicking in even as the U.S. made a huge leap forward in approving its highly anticipated tax reform.
What are markets doing: The Stoxx Europe 600 index dropped 0.3% to 389.77, building on a 0.4% loss from Tuesday.
Germany's DAX 30 index erased 0.3% to 13,171.34, while France's CAC 40 index slumped 0.5% to 5,357.11.
The U.K.'s FTSE 100 index lost 0.2% to 7,532.88.
The euro rose to $1.1850, up from $1.1840 late Tuesday in New York.
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What's driving the market: Analysts said Wednesday's weakness came as traders booked some profit ahead of Christmas after markets rallied earlier this week on signs Republicans in the U.S. were close to passing sweeping tax reforms.
Both the House of Representatives and the Senate passed the tax bill on Tuesday (http://www.marketwatch.com/story/republican-tax-bill-clears-house-and-heads-to-senate-for-vote-2017-12-19), but the Senate's parliamentarian found minor provisions that broke budget rules, forcing lawmakers to strip them out and requiring the House to vote again. House leaders have scheduled a new tax vote for Wednesday morning.
U.S. President Donald Trump has scheduled a press conference for 1 p.m. Eastern Time, or 6 p.m. London time.
Hopes for tax cuts have boosted markets globally in recent weeks, partly because the package is seen as benefiting businesses and providing a boost to the economy. Among the plan's many features, the bill cuts the corporate tax rate to 21% from 35%.
What are strategists saying: "Having teased, tantalized and promised the markets for most of this year that we would see some significant measures to reform the tax code it seems that U.S. President is on the cusp of delivering some measures that, depending on who you listen to, are either transformative or unfair," said Michael Hewson, chief market analyst at CMC Markets UK, in a note.
"The big question now is whether having seen stocks rise in anticipation of legislation being passed, that the current momentum is maintained or we see a case of 'buy the rumor, sell the news' as we head towards the Christmas break," he added.
(END) Dow Jones Newswires
December 20, 2017 04:12 ET (09:12 GMT)