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S&P 500 Futures Jump After Senate OKs Budget Resolution Paving Way For Tax Cuts | Stock News & Stock Market Analysis

Futures for the S&P 500 index, Nasdaq 100 and Dow industrials jumped early Friday morning after the Senate approved a budget resolution late Thursday, paving the way for up to $1.5 trillion in tax cuts over the next 10 years.

XAutoplay: On | OffS&P 500 futures rose 0.3% vs. fair value, while Dow futures climbed 0.4% and Nasdaq 100 futures advamced 0.4%.

It’s unclear how much tax cuts are already priced into the stock market, which has rallied significantly since President Trump’s election in large part on hopes for lower corporate tax rates and other reforms.

Also, Trump and GOP lawmakers may have unrealistic expectations about the size of the tax cuts given the budget constraints. But the resolution, passed by a 51-49 vote, is still a key step. It allows Republicans to push for net tax cuts of up to $1.5 trillion without Democratic support.

Before the budget vote, highly rated Celgene (CELG), PayPal (PYPL) and Atlassian (TEAM) active in late trading on earnings and other news. During the regular session, the S&P 500 index and Dow erased losses to close slightly higher, but the Nasdaq retreated as FANG stocks Facebook (FB) and Google parent Alphabet (GOOGL) drifted below recent breakout entry points.

PayPal, Celgene, E-Trade Financial (ETFC) and Atlassian all have Composite Ratings of 95 or better. The Composite Rating, which runs from 1 to 99, combines several proprietary IBD ratings into one number. All-time stock winners often have Composite Ratings of at least 95 near the start of their big runs.

FANGs Facebook, Google

Facebook fell 0.8% to 174.56, closing off intraday lows for 172.64 but still ending below a 175.59 buy point cleared on Tuesday. Thursday’s slide wasn’t that impressive, but neither was the breakout, though Tuesday’s upside move came on above-average volume.

Alphabet dipped 1.1% to 1,001,84 on Thursday, below its 1,006.31 entry topped on Oct. 13. Again, the Google parent’s retreat was rather modest, though it did come on volume that was 11% above trend.

The problem with lackluster breakouts, which have been all too common in recent months, is that they suggest a lack of institutional support. And by creeping just over buy points and not advancing, stocks such as Facebook and Google are vulnerable to going underwater on modest market, industry or company-specific news.

Then again, any piece of good news or market momentum could push these stocks back into buy zones.

95-Plus Stocks Moving

PayPal, 98 Composite Rating: PayPal reported a 31% earnings per share gain, with revenue up 21% to $3.24 billion, both better than expected. The online payments processor gave Q4 EPS and revenue guidance basically in line with analyst views. PayPal rose 3.6% in late trading. PayPal closed down 1 cent to 67.25, but was up 70% so far in 2017.

Celgene, 99 Composite Rating: Celgene announced that it is discounting two trials for a Crohn’s disease drug and will not start a third. It said mongersen (GED-301) failed an interim futility analysis. Celgene had spent $710 million in 2014 to obtain mongersen. Shares of the biotech giant tumbled 6.3% after hours. Celgene closed down 0.9% at 135.96. The stock had undercut a 139.10 buy point about two weeks ago and last Friday fell below its 50-day moving average.

Atlassian, 98 Composite Rating: Atlassian earned 12 cents a share in its fiscal Q1, up 20%, with revenue up 42% to $194 million, both topping the consensus. The maker of project-management and collaborative software raised guidance. Atlassian jumped 12.5% in late trading. During Thursday’s regular session, the stock dipped to 39.06 intraday, below a recent 39.35 buy point, but rallied to close up 1.1% at 40.25.

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