Wall Street shares which started the week on a positive note has recently retreated from its previous gains following a decline in the stocks of the financial sector on Wednesday. US stocks previously traded to new highs during Monday and Tuesday’s trading session despite the political turmoil in Saudi Arabia as well as market concerns regarding the corporate tax reform in the United States.
Last week, the Republican Senate revealed its plans to cut down corporate taxes by around 20% to 35%. Other provisions also were included in the plan including a number of tax breaks in specific sectors or companies.
However, market worries regarding the tax cuts and the possibility of another interest rate hike being implemented before the end of the year caught up to the market sending most financial shares down during early Wednesday session weighing down on the indices on Wall Street.
The greenback traded down against six other major currencies on concerns of the tax reforms in the United States and talks of the plans being delayed further. Analysts have recently noted the number of problems leading to a delay of the corporate tax cuts by as long as one year.
During the trading session, shares of Goldman Sachs inched 1.51% lower making it one of the biggest losers on the main stock index. The S&P 500 financial index fell 1.4% as early as Tuesday’s session. The 10-year U.S. Treasury yields recorded its most flat decade following the losses of a number of financial shares as the markets especially financial stocks are currently concerned of their profits being cut with lesser interest rates.
Global stocks were mostly positive during the start of the week with the S&P 500 starting 0.13% at a record high while the Dow Jones Industrial average hit 23.548.42. Asian shares also hovered at a ten-year high as crude oil prices gained sending the energy sector in the region to trade higher. Stocks in the Eurozone was also mostly optimistic with the pan-European STOXX 600 index trading 0.2% higher in the midst of a weak earnings week.
Despite the decline in financials, other indices such as the Dow Jones Industrial Average still recorded new record highs on Tuesday’s trading session. The Dow Jones Industrial Average was 0.04% higher by the end of the trading session to 23,557.23 despite starting the session slightly lower. The S&P 500 edged 0.02% lower to 2,590.64 while the Nasdaq Composite declined by 0.27% to 6,767.78. The S&P 500 have gained around 21% over the past twelve months or since the election of U.S. President Trump as the markets awaited a corporate tax cut from his administration.
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