Two-Day Stock Rally Pauses as Trump Tax Plan Details Unfold

U.S. stocks were little changed, with equity benchmarks near records, as investors sifted through details on President Donald Trump’s tax plan, as well as earnings from companies including Twitter Inc. and PepsiCo.

The S&P 500 added less than 0.1 percent to 2,389 at 9:40 a.m. in New York. The benchmark on Tuesday capped its biggest two-day rally since the U.S. election amid strong earnings and speculation of lower U.S. corporate taxes. The Dow Jones Industrial Average rose 10 points to 21,007 on Wednesday.

  • Health-care (+0.7%) and telecom (0.3%) leading market in early trading
  • Real estate (-.0.8%), consumer staples (-0.6%) biggest laggards
  • Financial and industrial shares little changed
  • Volume in S&P 500 about at 30-day average at this time
  • VIX up to 10.8
  • Stock market valuations have become divorced from reality, David Einhorn’s Greenlight Capital wrote to clients on Tuesday, warning of a bubble
    • S&P 500 trades near highest valuation since 2002, based on a forward P/E basis
  • POLITICS:
    • U.S. President Donald Trump is expected to propose cutting the corporate tax rate to 15% in an announcement today, a move that many economists view as more about deal-making than economic policy
    • He’ll also propose a 10% tax on more than $2.6 trillion in earnings U.S. companies have stockpiled offshore, according to a White House official familiar with the plans
  • ECONOMY:
    • MBA mortgage applications index rose 2.7% in week ended April 21 after falling 1.8% in prior week
  • EARNINGS (S&P 500):
    • After-market Wednesday: Varian Medical Systems Inc (VAR), Extra Space Storage Inc (EXR), AvalonBay Communities Inc (AVB), Fortune Brands Home & Security Inc (FBHS), Amgen Inc (AMGN), F5 Networks Inc (FFIV), XL Group Ltd (XL), Tractor Supply Co (TSCO), Cincinnati Financial Corp (CINF), Fiserv Inc (FISV), Equifax Inc (EFX), Equinix Inc (EQIX), Public Storage (PSA), Kimco Realty Corp (KIM), TechnipFMC PLC (FTI), Xilinx Inc (XLNX), Raymond James Financial Inc (RJF) ,Mid-America Apartment Communities Inc (MAA), PayPal Holdings Inc (PYPL), Citrix Systems Inc (CTXS), Unum Group (UNM), O’Reilly Automotive Inc (ORLY)
    • Pre-market Thursday: Simon Property Group Inc (SPG)Allegion PLC (ALLE), Air Products & Chemicals Inc (APD), L3 Technologies Inc (LLL), Marsh & McLennan Cos Inc (MMC), Iron Mountain Inc (IRM), Marathon Petroleum Corp (MPC), National Oilwell Varco Inc (NOV), EQT Corp (EQT), LKQ Corp (LKQ), International Paper Co (IP), CME Group Inc (CME), Helmerich & Payne Inc (HP), Alexion Pharmaceuticals Inc (ALXN), Praxair Inc (PX), American Airlines Group Inc (AAL), BorgWarner Inc (BWA), Xcel Energy Inc (XEL), Teradata Corp (TDC), AbbVie Inc (ABBV), American Electric Power Co Inc (AEP), Boston Scientific Corp (BSX), Southwest Airlines Co (LUV), Dow Chemical Co/The (DOW), Johnson Controls International plc (JCI), Invesco Ltd (IVZ), Under Armour Inc (UAA), CBRE Group Inc (CBG), Bristol-Myers Squibb Co (BMY), Comcast Corp (CMCSA), American Tower Corp (AMT), Ford Motor Co (F), Union Pacific Corp (UNP), Raytheon Co (RTN), Zimmer Biomet Holdings Inc (ZBH), Parker-Hannifin Corp (PH), Celgene Corp (CELG), SCANA Corp (SCG), United Parcel Service Inc (UPS)

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