MARKET SNAPSHOT: Stocks Hit Records, But Pare Gains As Investors Await Clarity On Tax Policy

If tax rates come down, market multiples 'will look much more reasonable,' strategist says

U.S. stocks hovered near all-time highs on Tuesday, but moves were muted as the latest round of corporate earnings failed to push major indexes further into record territory and as investors awaited clarity on tax policy coming out of Washington, which could provide the next catalyst for the market.

What are the main benchmarks doing?

The Dow Jones Industrial Average rose less than a point at 23,548. The S&P 500 index also traded near break-even levels at 2,591. The Nasdaq Composite Index slipped 15 points, or 0.2%, to 6,776. All three indexes inched up to records in early trading, but have pared that early advance.

All three benchmarks closed at records on Monday (, marking the 26th time this year that they've notched records simultaneously, which is itself a record. The three gauges are up between 16% and 26% for the year as of Monday's close, boosted by factors such as an expanding U.S. economy, growing corporate profits and bets that the Trump administration will deliver tax cuts and other business-friendly measures.

What are strategists saying?

"The market is getting stretched on valuations, but if the tax cuts come through, the market will look a lot cheaper than it is. If rates come down, the multiples will look much more reasonable," said Sandy Villere, a portfolio manager who oversees about $2 billion in assets at St. Denis J. Villere & Company. "As long as tax talk is on the table, the market should continue grinding higher. You have a nice jobs picture, low interest rates, and earnings have been really good."

What could help drive markets?

President Donald Trump, on a trip throughout Asia, warned North Korea that he was prepared to use the full range of U.S. military power to stop any attack. But in a more conciliatory appeal, he urged Pyongyang to "make a deal" to end the nuclear standoff, a Reuters report said (

On the Fed front, Yellen is due to give a speech at 3 p.m. Eastern Time in Washington, D.C., as the departing chairwoman accepts an award for ethics in government.

Before that, the central bank's vice chairman for supervision, Randal Quarles, is slated to talk at 12:35 p.m. Eastern at a conference focused on banking regulations and the payments industry.

Investors are also looking for clarity on tax policy after congressional Republican unveiled a long-awaited plan last week, though it was unclear when the policy could be enacted, what form it might take, or even whether it was likely to pass at all (

What data are in focus?

The number of job openings in the U.S. rose slightly ( September to 6.09 million, keeping them near a record high.

A report on consumer credit is due at 3 p.m. Eastern.

Check out:MarketWatch's Economic Calendar (

Which stocks are in focus?

Shares in Priceline Group Inc.(PCLN) and TripAdvisor Inc.(TRIP) fell 11% and 18%, respectively, after each online travel company sounded downbeat ( about fourth-quarter revenue ( while posting earnings late Monday. The companies also seem to be planning an increase in advertising spending (

Etsy Inc. (ETSY) fell 2.6% after the craft-oriented e-commerce company late Monday reported its quarterly results (

Valeant Pharmaceuticals International Inc.(VRX.T) jumped 16% after it reported better-than-expected quarterly result, though it lowered its guidance for the rest of 2017.

Dean Foods Co.(DF) reported revenue of $1.94 billion, compared with Wall Street estimates for revenue of $1.96 billion and profit of 20 cents a share, versus 21 cents expected, representing weaker-than-expected profit and revenue for the foods company. However, shares rose 7.2%.

SeaWorld Entertainment Inc.(SEAS) reported third-quarter earnings on Tuesday that were below Wall Street expectations ( Net income for the quarter was $55.03 million, or 64 cents per share, down from $65.66 million, or 77 cents per share during the same quarter a year ago. The stock rose 4.9%.

Crocs Inc. (CROX) slumped 9% after the footwear seller beat revenue expectations but provided a downbeat outlook ( For the quarter to Sept. 30, the net loss was $2.3 million, or 3 cents a share, compared with a loss of $5.4 million, or 7 cents a share, in the same period a year ago.

What are other assets doing?

Europe's main stock gauges traded either flat or up slightly. Asian markets mostly finished higher (, with Japan's Nikkei benchmark jumping 1.7% to reach its highest close since 1992, as one analyst noted "few risks on the horizon."

Haven plays such as gold futures and the Japanese yen were losing ground. The ICE U.S. Dollar Index traded higher, while West Texas Intermediate crude were little changed after surging in the previous session.

(END) Dow Jones Newswires

November 07, 2017 11:25 ET (16:25 GMT)