Hopes for corporate tax cuts drive US stocks upwards
US stocks have set more records as investors grow more certain Republicans will pass their tax plan this week.
Technology companies climbed, as did banks and retailers, which are likely to see lower taxes.
Stocks have made hefty gains as the GOP appeared to shore up enough support to pass the bill, and Congressional Republicans are scheduled to start voting on the legislation tomorrow.
The biggest gains have gone to companies that pay relatively higher tax rates, including smaller, US-focused companies, banks and retailers.
Deal news also helped put investors in a buying mood. Two major food companies agreed to buy smaller snack makers: Campbell Soup plans to purchase pretzel maker Snyder's-Lance for 4.87 billion dollars and Hershey will buy Amplify Snack Brands for 1.2 billion dollars.
The Standard & Poor's 500 index gained 14.35 points, or 0.5%, to 2,690.16. The Dow Jones industrial average advanced 140.46 points, or 0.6%, to 24,792.20.
The Nasdaq composite traded above 7,000 for the first time but later slipped below that milestone. It rose 58.18 points, or 0.8%, to 6,994.76. The Russell 2000 index of smaller-company stocks climbed 18.50 points, or 1.2%, to 1,548.92.
Campbell Soup will buy pretzel maker Snyder's-Lance for 50 dollars a share, or 4.87 billion dollars. The deal will give Campbell a group of brands including Snyder's of Hanover, Kettle Brand and Pop Secret. Snyder's climbed 3.25 dollars, or 6.9%, to 50.04 dollars. It has surged 27% since Tuesday's close on reports Campbell Soup was preparing a bid. Campbell gained 7 cents to 49.66 dollars.
Chocolate and candy maker Hershey agreed to buy Amplify Snack Brands for 12 dollars a share, or 1.2 billion dollars. Amplify's foods include Skinny Pop popcorn, Tyrrells potato chips and Oatmega protein bars. Amplify went public in August 2015 at 18 dollars a share but had fallen steadily for more than a year. On Monday its stock jumped 5.01 dollars, or 71.6%, to 12.01 dollars. Hershey added 12 cents to 114.26 dollars.
Stocks also climbed Friday as Republicans in Congress appeared to shore up support to pass their tax plan. They hope to muscle the 1.5 trillion dollars bill through Congress this week before a year-end break. The bill slashes the corporate tax rate, and that's especially significant for smaller and more domestically-focused companies because they pay higher rates than larger, more multi-national companies do.
Financial companies including regional US banks did well on Monday. Fifth Third Bancorp rose 44 cents, or 1.5%, to 30.47 dollars and KeyCorp gained 40 cents, or 2%, to 20.16 dollars.
Other leaders included technology companies. Apple gained 2.45 dollars, or 1.4%, to 176.42 dollars, another all-time high. Cloud services provider Akamai Technologies leaped after Elliott Management, led by activist investor Paul Singer, disclosed a 6.5% stake in the company and said it wants to discuss changes to the company's business and other areas. Akamai climbed 7.91 dollars, or 13.7%, to 65.67 dollars.
The dollar fell to 112.56 yen from 112.63 yen. The euro rose to 1.1784 dollars from 1.1757 dollars.
Germany's DAX rose 1.6% and the CAC 40 of France climbed 1.3%. In Britain, the FTSE 100 rose 0.6%.
Japan's Nikkei rose 1.6% after the country's exports surged in November, driven by robust demand for cars and manufacturing equipment. The Hang Seng in Hong Kong added 0.6% and the South Korean finished little changed.
AP
