MARKET SNAPSHOT: Dow Struggles To Return To Record Territory As Tax Bill Awaits Trump's Signature

By Sara Sjolin and Anora M. Gaudiano, MarketWatchFeaturesDow Jones Newswires

FedEx rises after earnings

Stock-market indexes were trading virtually unchanged on Wednesday, relinquishing modest opening gains as congressional Republicans sent tax-cut legislation to President Donald Trump for his signature.

Continue Reading Below

What are stock indexes doing?

The Dow Jones Industrial Average , which was up as much as 80 points shortly after the open, last traded nearly flat at 24,771. The blue-chip index is up more than 25% since the start of the year.

The S&P 500 was flat at 2,681, with seven of the 11 main sector trading higher. Consumer staples and technology stocks were leading the decliners, but were offset by gains from telecoms, energy and industrials.

The Nasdaq Composite Index was unchanged at 6,960.

What's driving the market?

While the hopes of the tax bill have driven the market all of this year, the near certainty of the tax bill's passage left investors apathetic over the actual news. The House of Representatives on Wednesday passed a historic tax bill--which they voted on for the second time due to a technical irregularity the day before. The bill includes a reduction in the corporate tax rate from 35% to 21%. The Senate passed the overhaul early on Wednesday (

See:House sends Republican tax bill to Trump (

What are strategists saying?

"The stock market is still supported by fundamentals, such as earnings and the economy. FedEx earnings last night, for example, confirmed that consumers are spending at healthy levels," said Diane Jaffee, senior portfolio manager at TCW.

"We expect the market to pause in January and sort the companies into winners and losers of the tax legislation, but ultimately continue to climb thanks to revenue and earnings growth," Jaffee said.

"While it's debatable who the real beneficiaries of the bill will be, stock markets have clearly benefited in anticipation of it, with major corporations being among the big winners of the bill," said Craig Erlam, senior market analyst at Oanda in a note.

"With equity markets having risen more than 25% since Trump's election victory, at least in part due to his tax reform plans, it's likely that this is almost entirely priced in at this point so it will be interesting to see whether the rally can now be maintained until the end of the year, or whether the Santa rally will instead grind to a premature halt as investors lock in some profits," he added.

What stocks are in focus?

Shares of FedEx Corp.(FDX) advanced 3.4% after the package-delivery giant late Tuesday reported second-quarter results that beat Wall Street expectations (

Chip company Micron Technology Inc.(MU) climbed 4.8% after late Tuesday reporting earnings that surpassed forecasts (

On the downside, Stitch Fix Inc.(SFIX) plunged 13% after the online clothing retailer late Tuesday reported earnings that topped forecasts, but the result did't reflect the "blowout quarter" bulls were hoping for (

Red Hat Inc.(RHT) lost 3.9%, brushing off better-than-expected earnings ( out late Tuesday.

Ahead of the bell on Wednesday, BlackBerry Ltd. (BB.T) reported revenue and profit that topped expectations, sending shares 11% higher.

General Mills Inc.(GIS) also reported revenue that beat forecasts and its shares were up 1.5%.

What's new on the economic front?

Existing-home sales ( to a 5.81 million seasonally adjusted annual rate in November, the National Association of Realtors said Wednesday. The number came in well above expectations.

What are other markets doing?

Asian stock markets closed mixed (, while European markets mainly were lower (

Oil ( and gold ( were both higher, while the ICE U.S. Dollar Index was flat around 93.469. The yield on the 10-year Treasury note rose 2 basis points to 2.49%, the highest level since March.

Bitcoin futures ( slid 2.6% to $17,725.

(END) Dow Jones Newswires

December 20, 2017 13:32 ET (18:32 GMT)