US Investors Cheer President Trump’s Tax Reform Plan
$DIA, $SPY, $QQQ, $VXX
Wednesday, US President Donald Trump said his tax-reform plan would “deliver historic tax relief to the American people” and would “dramatically reform America’s outdated, complex, and extremely burdensome tax code.”
“It’s a relic,” President Trump told a crowd at the State Fairgrounds in Indianapolis. “The current tax system is a colossal barrier, standing in the way of America’s economic comeback, because it can be far greater than it’s ever been.
Market participants received the tax reform framework, but it contained few surprises as many of the details sent out to the media beforehand.
Some of the most notable highlights of the plan include cutting the corporate tax rate to 20% from 35%, doubling the standard deduction, and reducing the number of tax brackets to 3 or 4 from 7. The individual tax rates would be set at 12%, 25%, and 35%, with a fourth option for the highest earners.
Details on how the US government will make up for the immediate loss in tax revenue were limited. This topic will likely be an area of contention for the GOP going forward as many conservatives are opposed to the idea of driving up the federal deficit, which would probably be necessary to fund the tax overhaul–at least in the short term.
The market responded favorably
Wednesday the major US stock market indexes finished at: DJIA +56.39 at 22340.71, NAS Comp +73.10 at 6453.26, S&P 500 +10.20 at 2507.04
Volume: Trade on the NYSE came in at: 835-M/shares exchanged
- NAS Comp +19.9% YTD
- DJIA+13.1% YTD
- S&P 500 +12.0% YTD
- Russell 2000 +9.4% YTD
|HeffX-LTN Analysis for DIA:||Overall||Short||Intermediate||Long|
|Bullish (0.49)||Very Bullish (0.59)||Very Bullish (0.67)||Neutral (0.21)|
|HeffX-LTN Analysis for SPY:||Overall||Short||Intermediate||Long|
|Bullish (0.33)||Neutral (0.20)||Bullish (0.46)||Bullish (0.33)|
|HeffX-LTN Analysis for QQQ:||Overall||Short||Intermediate||Long|
|Bullish (0.39)||Neutral (0.24)||Bullish (0.40)||Very Bullish (0.53)|
|HeffX-LTN Analysis for VXX:||Overall||Short||Intermediate||Long|
|Bearish (-0.45)||Bearish (-0.34)||Bearish (-0.35)||Very Bearish (-0.67)|