MARKET SNAPSHOT: Financials Lift S&P 500, Russell 2000 To Records; Nike Tumbles After Earnings

Tax overhaul proposal seen as bullish for small caps

U.S. stocks rose on Wednesday, with both the large-cap S&P 500 and the small-cap Russell 2000 hitting intraday records; financial shares were among the strongest sectors of the day.

What are the main equity benchmarks doing?

The Dow Jones Industrial Average rose 62 points, or 0.3%, to 22,346, erasing an earlier loss. The S&P 500 was up 11 points to 2,508, hitting an all-time high of 2,510.25 in midday trading.

The Nasdaq Composite Index was up 77 points, or 1.2%, to 6,457.

The Russell 2000 gained 1.9% in its biggest one-day percentage gain since November and hit a record of its own (

Financials were by far the strongest industry of the day. Among the biggest gainers on the day, Bank of America(BAC) was up 3.2% while Citigroup (C) added 2.4%. Wells Fargo & Co (WFC) was up 0.7%.

The Financial Select Sector SPDR ETF (XLF) rose 1.5% and hit its highest level in nearly a decade (

What's driving the market?

Federal Reserve Chairwoman Janet Yellen on Tuesday said the central bank won't dawdle while raising interest rates ( The news was positive for banks, which typically do better in periods of higher rates, due to the positive impact they have on net interest margins.

However, St. Louis Fed President James Bullard said the economy was likely to remain on a slow-growth track with subdued inflation (, meaning the Federal Reserve can hold interest rates steady.

Read:Why the Fed trumps North Korea when it comes to financial markets (

Separately, congressional Republicans unveiled a plan to overhaul the U.S. tax code ( that looks to sharply reduce tax rates on businesses and many individuals. One of the reasons markets have risen throughout 2017 is the prospect of tax reform passing, which is expected to be a tailwind for markets. However, the Republican-controlled Congress was unable to pass health-care reform despite several attempts and versions, and it is unclear how likely it was that tax-reform could be passed.

What are market participants saying?

"There's a lot of optimism about tax reform, especially among small-caps, which stand to benefit more if this is enacted," said Michael O'Rourke, chief market strategist at JonesTrading. "There's also been some additional rotation into the parts of the market that have been doing well."

With the Russell's gain on the day, the index is up 5.7% thus far this month, compared with the 1.5% rise of the S&P 500.

Read more:Wilbur Ross says tax reform could boost economy by 1% (

And see:GOP tax plan to allow for top individual rate above 35% (

Which stocks are in focus?

Nike Inc.(NKE) fell 3.5% after the sneakers giant late Tuesday posted fiscal first-quarter earnings that beat forecasts, but its revenue was slightly below expectations ( The stock was one of the biggest drags on the Dow.

Shares in Micron Technology Inc.(MU) rose 7.9% a day after the chip maker reported better-than-expected earnings (

J.P. Morgan Chase & Co. (JPM) was ordered to pay ( more than $4 billion in damages for mismanaging the estate of a former executive for American Airlines (AAL). Shares of the investment bank rose 1.4%.

Therapix Biosciences Ltd. (TRPX.TV) jumped 6.5% following positive preclinical results ( for a potential cognitive-impairment therapy.

See:Micron reassures investors that memory-chip demand remains very high (

What are other assets doing?

The ICE U.S. Dollar Index ( was gaining, building on Tuesday's rise ( (

Gold futures ( lost ground, while oil futures ( were little changed.

European stocks ( rose, and Asian markets closed mixed (

Don't miss:The stock sector that has been 2017's big loser became a big winner this month (

Read:Here's why value stocks are starting to outperform growth (

What are the data?

Orders for durable goods rose 1.7% in August, beating forecasts for a 1% rise (

The National Association of Realtors' pending home sales index ( fell 2.6% to 106.3, the group said Wednesday. That was the lowest reading since January 2016 and put the index 2.6% lower than its level a year ago.

Check out:MarketWatch's Economic Calendar (

Which Fed speakers are on tap Wednesday?

(END) Dow Jones Newswires

September 27, 2017 15:09 ET (19:09 GMT)