Wall Street eyes high score as videogame makers rally

Wall Street Reuters

(Reuters)

The S&P 500 approached its highest ever close on Wednesday as a rally in videogame makers helped offset doubts about an ambitious Republican plan to cut corporate taxes and weakness in banks.

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Apple (AAPL) rose 0.65 percent, putting it on track to end the day with a market value above $900 billion for the first time.

Take-Two Interactive Software (TTWO) jumped 10.8 percent after the videogame maker offered a stronger-than-expected revenue forecast for the holiday quarter.

That sparked a rally among its competitors, with Activision Blizzard (ATVI) surging 5.80 percent and Electronic Arts adding 1.9 percent.

Investors were nervous about the potential outcome of the Republican plan unveiled last week that would cut corporate taxes while eliminating a range of popular tax breaks. The bill is expected to face strong opposition from interest groups.

Republicans have yet to score a major legislative win since Trump took office in January, even though the party controls both chambers of Congress as well as the White House.

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“It’s a complicated, messy affair to get a tax bill passed,” said Tim Dreiling, Regional investment Director for U.S. Bank Private Wealth Management, with $150 billion in assets under management.

“There is going to be some give and take before we get a final tax package to be voted on.”

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The S&P 500 has risen about 21 percent since the election of President Donald Trump a year ago, partly on the back of his promises to cut taxes and other business-friendly measures.

At 2:23 pm ET (1923 GMT), the Dow Jones Industrial Average was up 0.05 percent at 23,569.28 points, while the S&P 500 had gained 0.13 percent to 2,594.04.

At that level, the S&P 500 was below an intra-day record high set on Tuesday but was higher than its previous record closing level on Monday.

The Nasdaq Composite added 0.28 percent to 6,786.64.

Five of the 11 major S&P sectors were higher, led by a 0.98-percent rise in consumer staples.

The tech sector was boosted by a 1.45 percent rise in Qualcomm (QCOM).

Snapchat-owner Snap (SNAP) fell 16.6 percent a day after reporting much-slower-than expected advertising revenue and user growth. Snap said China’s Tencent bought a 12-percent stake in the company.

Declining issues outnumbered advancing ones on the NYSE by a 1.07-to-1 ratio; on Nasdaq, a 1.16-to-1 ratio favored decliners.

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