The stock market is riding a wave of success during the President Donald Trump’s first year in office.
All three major equity indexes closed Wednesday at records simultaneously for the 23rd time this year, while the Dow Jones Industrial Average eclipsed the 23,000 mark for the first time ever. The indexes closed after reports surfaced showing Republican senators have enough votes to pass a budget measure that could pave the way for Trump’s tax reform.
The Dow Jones Industrial Average climbed 160.16 points to 23,157.60, as the S&P 500 index jumped nearly two points at 2,561.26 and the Nasdaq Composite ticked up to 6,624.22 — analysts argue the reason for the jump is two-fold: Earnings are up and the European economies are climbing out of their doldrums.
“It’s obvious that the stock market follows earnings, but the market narrative always wants to find something more interest. But the reality is very simple: The market has gone higher because earnings have improved,” Kevin Caron, a portfolio manager who helps oversee $180 billion at Stifel Nicolaus, told reporters when asked what was driving the record-breaking highs.
Republican efforts to push and pull tax reform front-and-center of Trump’s orbit. The stock market will jump again if income tax reductions are hashed out before the end of the year, analysts believe. Republican senators took one big step Wednesday afternoon toward making that happen.
Senate Republican Whip John Cornyn, who is in charge of corralling votes, told reporters that he expected the fiscal 2018 spending blueprint to draw the support necessary to unlock a legislative tool enabling Republicans to pass tax reform with help from Democrats.
“I believe we do,” Cornyn said when asked if he Republicans have enough votes. The resolution requires approval from at least 50 lawmakers in the 100-seat chamber, with Vice President Mike Pence able to cast a tie-breaking vote.
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