Wall Street hits record, investors eye major chip deal
U.S. stocks rose to record highs on Monday after Broadcom made a monster bid for Qualcomm and investors bet that a Republican plan to cut corporate taxes would bolster earnings.
"The fact that the deal is on the table is huge," said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago.
"We have not seen much in the way of dealmaking this year. So this might jumpstart some of the dealmaking ahead of the tax policy changes."
Investor optimism was also fuelled by a Republican proposal last week to slash the corporate tax rate to 20 percent from 35 percent and end some tax breaks for companies and individuals.
"I think that has to be the main driver," said John Brady, managing director at R.J. O`Brien & Associates in Chicago. "Even if it only goes to 25 percent or 27 percent, it`s still moving the right way."
Shares of Sprint
All three major indexes were on track to close at record highs.
At 2:25 pm ET, the Dow Jones Industrial Average <.dji> was up 0.1 percent at 23,563.4 points, while the S&P 500 <.spx> had gained 0.15 percent to 2,591.83.
The Nasdaq Composite <.ixic> added 0.3 percent to 6,784.76.
The S&P 500 energy index <.spny> surged 1.92 percent on gains in crude prices after the crown price of Saudi Arabia, the world`s largest oil exporter, tightened his grip on power through an anti-corruption purge. [O/R]
U.S. companies continue to report their quarterly earnings. With more than 400 of S&P 500 companies having reported, earnings for the third quarter are expected to have climbed 8 percent, compared to an expectation of a 5.9 percent rise at the start of October, according to Thomson Reuters I/B/E/S.
Advanced Micro Devices
Advancing issues outnumbered declining ones on the NYSE by a 1.36-to-1 ratio; on Nasdaq, a 1.17-to-1 ratio favoured advancers.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
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