“With rates going up, that is why banks move. If prices go up and are sustainable they can begin to generate some money,” stated Thomas Martin, senior portfolio manager at GLOBALT Investments in Atlanta, Georgia.
Trump proposed the tax overhaul in three decades but offered scant information about how to pay without driving up deficits.
Also serving to cap gains on the Dow and S&P were Nike (NKE.N) shares, which declined 1.92 percent after the company posted its slowest quarterly sales growth in almost seven years and said it expected a further drop in earnings from North America.
NEW YORK (Reuters) – U.S. stocks rose on Wednesday as gains in financial shares were powered by rising expectations for a December interest rate hike and on expects President Donald Trump’s administration may be making progress on a tax program.
New orders for U.S.-made capital goods increased more than expected in August and prices maintained their upward trend, pointing to underlying strength in the economy.
Traders now see about a 78 percent chance of a December rate increase, compared with approximately 73 percent according to CME Group’s FedWatch tool.
The Dow Jones Industrial Average . DJI rose 56.39 points, or 0.25 percent, to 22,340.71, the S&P 500 .
Advancing issues outnumbered declining ones on the NYSE by a 1.29-to-1 ratio; on Nasdaq, a 2.71-to-1 ratio favorite advancers.
Bank of America (BAC.N) rose 2.42 percent and Goldman Sachs (GS.N) gained 2.1 percent as the biggest boost to the Dow.
Reporting by Chuck Mikolajczak; Editing by James Dalgleish
Rose 1.92 percent and notched its very best day since early March. Names are likely to be the beneficiaries of a tax cut.
Approximately 6.55 billion shares changed hands in U.S. exchanges, compared with the 5.91 billion daily average over the last twenty sessions.
“For the first time since we have had Trump and the administration in office, it looks like there is incrementally more of a possibility of tax reform going through that would really be meaningful,” said Martin.
The information, coupled with comments from Fed Chair Janet Yellen on Tuesday boosted anticipation the Federal Reserve would increase U.S. interest rates in December, lifting yields on U.S. Treasuries, which then pushed financials .
Interest-rate-sensitive and dividend-paying sectors declined. The consumer staples indicator . SPLRCS fell 0.73 percent while utilities . SPLRCU fell 1.34 percent and real estate . SPLRCR lost 0.84 percent.