It’s a November to remember for U.S. investors, as the Dow Jones Industrial Average closed for the first time ever above the key 24,000milestone and posted its biggest one-day point gain of the year. The Dow surged 331.67 points, marking the 63rd record close under President Donald Trump.
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That performance capped off the eighth straight month of stock gains. For the Dow, that’s the best streak since 1995, and for the S&P 500, it’s the best since 2007, as tracked by FOX Business’ partners at the Wall Street JournalMarket Data Group.
GOP lawmakers on Thursday provided the latest catalyst for the gains by indicating their tax reform plan is all but done. Sen. John McCain (R-Ariz.), a sometimes outspoken critic of President Trump, announced that he would support the plan. That prompted Senate Majority Leader Mitch McConnell (R-Ky.) to suggest a passing of the bill is imminent, helping to seal the fifth 1,000 point milestone of 2017 and the most ever in a calendar year.
While optimism over the president’s tax plan is dominating the headlines, a batch of recent economic data points underscore a solid rebound in the U.S. economy. Third quarter GDP rose 3.3%, which is better than expected, according to its second read. New home sales for October surged to the highest level in a decade and consumer confidence hit a 17-year high. The passing of tax reform could intensify the economic rebound, according to the Tax Foundation, a D.C.-based think tank, by lifting U.S. GDP to 3.7%.
Tax reform aside, America’s biggest companies are doing their part by growing profits and making acquisitions. Kroger (KG), the nation’s largest supermarket chain, on Thursday reported its best Black Friday ever after posting sales of nearly $28 billion.
Walmart (WMT), the world’s largest U.S. retailer, is the top performing Dow stock this year with a 41% gain. CVS (CVS) and Aetna (AET) are close to announcing a $66 billion deal, per the Wall Street Journal. All are signs of positive corporate sentiment.
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As December begins, investors are reminded the final month of the year can traditionally bring a so-called ‘Santa Claus Rally’, when stocks tend to rise during the final week of the month. But with gains in U.S. stocks already robust, the S&P 500 and Dow up 18% and 23% respectivelyand the Nasdaq Composite up 28%, can the gains continue?
For some business leaders, the key will be lowering the corporate tax rate to the promised 20% level, which may be the extra boost stocks need to continue rising.
“That could easily mean that we will get another 10% move in the next couple of months on the equity markets” UBS Chairman Axel Weber saidduring an interview on FOX Business’“Mornings With Maria” on Thursday