Wall Street set to rally after Senate approves tax bill
(Reuters) - Wall Street was set to start the week on a bright note after the U.S. Senate passed its version of a tax overhaul bill, bringing closer to reality President Donald Trump's promise of cutting corporate taxes to spur growth.
Dow futures gained more than 200 points, while the Nasdaq and the S&P 500 futures were up about half a percent.
Some of the early gainers included bank and industrial stocks. Bank of America (NYSE:BAC) and JPMorgan (NYSE:JPM) rose more than 2 percent, while Caterpillar (NYSE:CAT) and Boeing (NYSE:BA) gained about 1.5 percent.
"This is a positive reaction to the Senate's passage," said Randy Frederick, vice president of trading and derivatives for Charles Schwab in Austin, Texas.
The Senate on Saturday approved their version of tax bill in a narrow 51-49 vote. The Senate and House of Representatives will have to reconcile their respective versions before it becomes a law.
"That (reconciliation)can be a bit of a challenge because there are differences and the number of approvals to pass it is a little bit higher than it was for the individual two sides of the Congress," said Frederick.
The S&P 500 has risen about 18 percent this year on strong corporate earnings and solid economic growth and also on hopes that Trump's agenda of corporate tax cuts and looser regulations could come through.
At 8:31 a.m. ET (1331 GMT), Dow e-minis <1YMc1> were up 211 points, or 0.87 percent, with 45,391 contracts changing hands.
S&P 500 e-minis were up 13.75 points, or 0.52 percent, with 239,543 contracts traded.
Nasdaq 100 e-minis were up 28.75 points, or 0.45 percent, on volume of 44,070 contracts.
Aetna (NYSE:AET) shares jumped 3.2 percent in premarket trading after drugstore chain operatorCVS Health (NYSE:CVS) agreed to buy the health insurer for $69 billion in the year's largest corporate acquisition. CVS shares were down marginally.
General Cable (NYSE:BGC) jumped about 33 percent after Italian rival Prysmian agreed to buy the cable maker in a deal that could value it at about $3 billion, including debt.
Blue Apron (NYSE:APRN) rose 7.43 percent after Barclays upgraded the meal-kit delivery company's stock to "equal-weight", supporting its move to promote its chief financial officer as the chief executive.
Wall Street indexes ended lower on Friday amid concerns over developments surrounding a probe into Russia's alleged involvement in the 2016 U.S. presidential election.
(Reporting by Sruthi Shankar and Rama Venkat Raman in Bengaluru; Editing by Arun Koyyur)