Wall Street hits record highs on US tax overhaul optimism

Wall Street hits record highs on US tax overhaul optimism
American stocks finished Wednesday with record gains as Jerome Powell moves a step closer to chair the Federal Reserve and the Senate is expected to vote for big changes to the US tax code.

All three major indices soared toward intraday peaks and a new round of closing records with the Dow Jones Industrial Average rising 256 points, or 1.1 percent to close at 23,836.71. The S&P 500 added 25.62 points or one percent to 2627.04. The Nasdaq Composite was up 33.84 points, or 0.5 percent, closing at 6912.36. The Russell 2000, which tracks small-cap stocks, also outperformed posting a 1.5 percent gain.

The surge was reportedly triggered by progress on tax cuts and a debut for Fed chair nominee Jerome Powell, who was picked by President Trump to replace Janet Yellen. Testifying before the Senate, he signaled support for raising interest rates at a gradual pace.

At the same time, the Senate Budget Committee moved on tax reform with the bill sent further to the Senate floor. The tax plan includes a massive reduction in the corporate tax rate and lower taxes for most individual filers.

The key indices briefly retreated after North Korea fired its ballistic missile, which is allegedly able to hit the entire US mainland but resumed the climb following the tax news.

US stocks have been on a roll since Donald Trump’s election in January. The major indices have reached multiple record highs this year. The 45th US president posted about the latest stock rally in his Twitter account.