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Wall Street extends losses at opening amid tax-delay jitters

Major equity indexes in the U.S. started the last day of the week under pressure as concerns over a delay in the highly anticipated corporate tax cut continue to hurt the market sentiment.

On Thursday, the Senate Republicans’ tax bill proposal diverged from their House counterparts’ plan as it offered to implement the corporate tax reduction to 20% from 35% in 2019 instead of next. With the initial market reaction, equity indexes lost nearly 1% before staging a modest recovery in the last hours of Thursday. Moreover, the Senate's tax bill version is seen as hurting the incentive to purchase homes, which weighs on the bank shares as it's likely to hurt the mortgage profits. 

The S&P 500 Financial Sector (SPSY) is down 0.2% while the S&P 500 Information Technology Sector (SPLRCT), which reacts sharply to weakening market sentiment, is losing 0.3%.

At the time of writing, the Dow Jones Industrial Average was dropping 45 points, or 0.2%, at 23,417.37, the S&P 500 was losing 8 points, or 0.3%, at 2,576.05 and the tech-heavy Nasdaq Composite was down 13.35 points, or 0.2%, at 6,736.70.

Today's key headlines

  • Joint Tax Committee: US Senate tax proposal is within $1.5 trln ceiling on deficit expansion
  • US Pres Trump will not meet with Russia’s Putin in Vietnam – White House
  • US: Trump’s “state visit plus” to Beijing didn’t go without a gasp - Rabobank
  • USD: Reflation sentiment dented as Senate serves up a Tax Bill curveball - ING
  • US Pres Trump: Current trade balance with China not acceptable

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