Stocks are opening solidly higher on Wall Street following more deal news and progress on the Republican tax overhaul plan, which passed the Senate in the early morning hours Saturday.
Banks rose more than the rest of the market in early trading Monday. Bank of America (BAC) jumped 3.4 percent.
“We think the chances the tax bill will be finished by the end of 2017 have risen to around 65% (up from 50% before the Senate vote), and our estimate of the chances of the bill passing regardless of the timing are now in the 80-85% range,” KBW analysts wrote.
The Standard & Poor’s 500 index rose 19 points, or 0.7 percent, to 2,661 by late morning Monday. The Dow Jones industrial average rose 224 points, or 0.9 percent, to 24,453. The Nasdaq composite climbed 43 points, or 0.7 percent, to 6,892.
“Tax reform legislation has now passed both chambers of Congress and looks very likely to become law by year-end, probably within the next two weeks,” Goldman Sachs economists wrote in a research note Monday. They emphasized, however, that “the compromise legislation we expect to emerge from the conference committee would reduce the effective corporate tax rate by only a couple of percentage points” relative to its current levels.
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