Dow snaps 8-week winning streak on tax delay fears

 

NEW YORK: Fears of a delay in President Donald Trump's long-promised corporate tax cuts sent the Dow lower on Friday, ending a two-month winning streak fueled by robust company earnings.

After closing every week higher since September 8, the Dow Jones Industrial Average fell 0.2 percent to end the week at 23,422.21.

Meanwhile, the broader S&P 500 fell less than a tenth of a point to 2,582.30, while the tech-heavy Nasdaq pared sharp early losses to scrape into positive territory, finishing up less than a tenth of a percentage point at 6,750.94.

Senate Republicans on Thursday released a tax plan that would put off promised steep corporate tax cuts for a year.

Otherwise, there was little in the way of economic data to move markets in any direction. A University of Michigan survey showed consumer sentiment had dimmed slightly in November but remained elevated.

Phil Davis of PSW investments told AFP the earnings season had moved to companies with smaller market capitalizations that were less likely to drive stock indices higher.

But the prospect of delayed tax cuts had nevertheless taken much of the wind out of Wall Street's sails, he said.

"A lot of the rally is priced on the full expectations of these companies to pay less taxes and earn more money," he said. "If the tax cut is delayed until next year I would expect a five percent correction."

Chip maker Nvidia helped move the Nasdaq higher, with the company's stock soaring 5.3 percent on earnings that beat expectations.

Disney — which announced a new Star Wars trilogy — led media companies higher, finishing up two percent.

Time Warner jumped four percent, recovering from losses that followed reports US authorities could force it to sell the CNN news network as a condition for approving the merger with telecom giant AT&T.