clear
Wednesday November 22nd, 2017 6:55PM

Small companies make biggest gains as US stocks rise

By The Associated Press
Related Articles
  Contact Editor

NEW YORK (AP) — U.S. stocks climbed Wednesday as smaller companies soared following a report that showed business investment climbed in August. Investors also hoped stocks will benefit from tax cuts proposed by President Donald Trump and congressional Republicans.

The Labor Department said orders for long-lasting manufactured goods rose, and a gauge of business investment climbed for the second month in a row. Investors hope that means U.S. manufacturing is getting stronger as the global economy continues to improve, and they bet on continued growth: technology companies rallied for a second day, while the prices of traditionally safe investments like bonds and gold dropped.

"We've been waiting for that," said Kate Warne, an investment strategist for Edward Jones, of the recent improvement. "Business spending has been relatively weak," with spending by consumers keeping the economy afloat.

Smaller, domestically-focused banks and technology and industrial firms made especially large gains, and the Russell 2000 index of smaller-company stocks made its biggest gain since March. The tax proposal was similar to what investors had come to expect, and with months of negotiations likely ahead and key details missing, it's not clear what kind of plan might ultimately pass. But lower corporate taxes could help smaller companies more than large ones.

"A corporate tax cut tends to be better news for smaller companies because they don't have as many ways to reduce their tax rate," said Warne.

The proposal would cut tax rates for individuals and corporations. It would lower the top corporate tax rate to 25 percent from its current 35 percent, and also reduces the number of personal tax brackets and nearly doubles the standard deduction used by most Americans.

The Standard & Poor's 500 index added 10.20 points, or 0.4 percent, to 2,507.04. The Dow Jones industrial average rose 56.39 points, or 0.3 percent, to 22,340.71. The Nasdaq composite leaped 73.10 points, or 1.1 percent, to 6,453.26.

The Russell 2000 did even better and continued to set records. It gained 27.95 points, or 1.9 percent, to 1,484.81. After a sluggish few months, the Russell has jumped more than 9 percent since mid-August. The S&P mid-cap and small-cap indexes also climbed.

The Labor Department's report gave investors hope the economy will keep growing, and Wall Street bet that interest rates will keep rising. The yield on the 10-year Treasury note climbed to 2.30 percent from 2.24 percent. That helped banks, as higher interest rates mean they can charge more to lend money. Bank of America picked up 60 cents, or 2.4 percent, to $25.41 and Citigroup rose $1.34, or 1.9 percent, to $72.28.

Meanwhile companies that pay big dividends took steep losses. Kimco Realty, a real estate investment trust that owns outdoor shopping centers, fell 75 cents, or 3.7 percent, to $19.41. Household products maker Procter & Gamble gave up $1.78, or 1.9 percent, to $90.87. Rising bond yields made government bonds a more appealing investment to investors seeking income.

The dollar got stronger and rose to 112.75 yen from 112.17 yen. The euro fell to $1.1756 from $1.1798.

Chipmaker Micron Technology had a better quarter than investors expected, and its stock rose $2.81, or 8.5 percent, to $37.09. Facebook climbed $3.47, or 2.1 percent, to $167.68 and Google's parent company Alphabet picked up $22.47, or 2.4 percent, to $959.90.

Shoe and athletic gear maker Nike said sales in the U.S. remained weak in its first fiscal quarter and steep discounts continued to affect its business. While its earnings and revenue were better than analysts expected, analysts chalked much of that up to lower taxes, stock repurchases, and spending cuts.

Nike lost $1.03, or 1.9 percent, to $52.67.

Utility company Scana took its biggest loss in almost nine years after state police in South Carolina said they are looking into "potential criminality" by the company after a nuclear plant construction project was shut down after some $10 billion had already been spent. Its South Carolina Electric & Gas unit and partner Santee Cooper canceled the project in July after contractor Westinghouse filed for bankruptcy.

Scana said it will cooperate fully with the inquiry. Its stock sank $4.35, or 7.8 percent, to a two-year low of $51.22.

Gold fell to its lowest in a month. The metal's price declined $13.90, or 1.1 percent, to $1,287.80 an ounce. Two weeks ago gold was at a 12-month high, but it's fallen sharply since then. Silver lost 6 cents to $16.83 an ounce. Copper rose 1 cent to $2.93 a pound.

Benchmark U.S. crude added 26 cents to $52.14 a barrel in New York while Brent crude, the standard for international oil prices, fell 54 cents, to $57.90 a barrel in London.

Wholesale gasoline fell 4 cents to $1.65 a gallon. Heating oil remained at $1.85 a gallon. Natural gas rose 6 cents to $2.97 per 1,000 cubic feet.

The FTSE 100 index in Britain rose 0.4 percent while Germany's DAX rose 0.4 percent. The CAC 40 in France added 0.3 percent. Japan's Nikkei 225 fell 0.3 percent and South Korea's Kospi dipped less than 0.1 percent. Hong Kong's Hang Seng index rose 0.5 percent.

___

AP Markets Writer Marley Jay can be reached at http://twitter.com/MarleyJayAP His work can be found at https://apnews.com/search/marley%20jay

  • Associated Categories: Associated Press (AP), AP Business, AP Business - Corporate News, AP Business - Economy, AP Business - Financial Markets, AP Business - Industries, AP Business - Utilities
© Copyright 2017 AccessWDUN.com
All rights reserved. This material may not be published, broadcast, rewritten, or redistributed without permission.
Issues remain as 3rd round of NAFTA talks wraps in Ottawa
Contentious issues remain in NAFTA renegotiations as the U.S., Canada and Mexico conclude a third round of talks
4:38PM ( 7 minutes ago )
Lawsuit: Kushner Cos. charges illegal fees to its tenants
The real estate company run by the family of Jared Kushner has been sued by two tenants in Maryland for allegedly adding excessive and illegal fees to their rent
4:37PM ( 8 minutes ago )
Small companies make biggest gains as US stocks rise
US stocks climb, and the biggest gains go to smaller banks, industrial and technology companies after the Labor Department said business investment appeared to get stronger in August
4:36PM ( 9 minutes ago )
Associated Press (AP)
'Nothing, nothing.' Aid lags in hurricane-torn Puerto Rico
The relief effort from Hurricane Maria in Puerto Rico has so far been concentrated largely in San Juan, and many outside the capital say they've received little or no help
4:02PM ( 43 minutes ago )
The Latest: Trump calls current tax system a 'relic'
President Donald Trump is calling the current tax system a "relic" and a "colossal barrier" that's standing in the way of the nation's economic comeback
3:57PM ( 48 minutes ago )
The Latest: Trump makes case for sweeping tax overhaul
President Donald Trump is making the case for a sweeping plan to overhaul the tax system for individuals and corporations
3:46PM ( 59 minutes ago )
AP Business
The Latest: Budget group says tax plan adds $2.2T to debt
A budget watchdog group in Washington says the new GOP tax plan could cost $2.2 trillion over the next 10 years
2:58PM ( 1 hour ago )
Trump heads to Indiana to sell tax plan
Trump tries to build momentum for tax plan, score a legislative win
2:41PM ( 2 hours ago )
Dems wield Equifax, Wells Fargo in fight over arbitration
Democratic senators are highlighting scandals at Wells Fargo and Equifax in a bid to stop Republicans from overturning a federal rule that would let consumers join together to sue financial companies
2:19PM ( 2 hours ago )
AP Business - Corporate News
Trump, GOP tax plan would cut rates for many Americans
President Donald Trump and congressional Republicans are rolling out a sweeping plan to cut taxes for corporations and potentially for individuals, simplify the tax system, and nearly double the standard deduction used by most Americans.
2:14PM ( 2 hours ago )
UK 'bitterly disappointed' as US trade ruling threatens jobs
U.K. Prime Minister Theresa May is "bitterly disappointed" by the U.S. Commerce Department's decision to slap duties of nearly 220 percent on Canada's Bombardier C series aircraft
12:58PM ( 3 hours ago )
Trump, GOP tax plan cuts rates, nearly doubles deduction
President Donald Trump and congressional Republicans are rolling out a sweeping plan to cut taxes for individuals and corporations, simplify the tax system, and likely double the standard deduction used by most Americans.
10:57AM ( 5 hours ago )
AP Business - Economy
Trump's tax plan: business owners win, deficit hawks lose
Small business owners, large corporations and the super wealthy could make out well under President Donald Trump's tax plan
11:17AM ( 5 hours ago )
Global stocks mixed as investors focus on US tax reform
Global stock markets are mixed as investors awaited the outlines of U.S. tax overhaul plans by President Donald Trump while news headlines on geopolitical tensions surrounding North Korea have quieted
6:21AM ( 10 hours ago )
Asian stocks mostly down as investors focus on US tax reform
Asian stock markets traded mostly lower as investors awaited the outlines of U.S. tax overhaul plans by President Donald Trump while headlines on geopolitical tensions surrounding North Korea quieted
3:18AM ( 13 hours ago )
AP Business - Financial Markets
APNewsBreak: Texas' oil regulator took vacation amid Harvey
Records show that Texas' chief oil and gas regulator was on vacation in the critical days surrounding Hurricane Harvey as fuel shortages became rampant and industrial tanks spilled
1:56PM ( 2 hours ago )
US Interior chief wants smaller monuments, but not at home
U.S. Interior Secretary Ryan Zinke has closely followed his boss' playbook, encouraging mining and drilling on public lands and reducing the size of national monuments _ except in Montana
1:41PM ( 3 hours ago )
Sonic: 'unusual activity' on some credit cards
Sonic says there's been some 'unusual activity' on credit cards used at some of its restaurants
11:52AM ( 4 hours ago )
AP Business - Industries
Probe opened into 'potential criminality' in nuke project
State police have opened a probe into possible criminality on behalf of one of the co-owners of a failed South Carolina nuclear project
4:49PM ( 23 hours ago )
US, Mexico expand pact on managing overused Colorado River
The U.S. and Mexico have agreed to expand a far-reaching conservation agreement that governs how they manage the overused Colorado River, which supplies water to millions of people and farms in both nations
4:47PM ( 23 hours ago )
Water and some food scarce as Puerto Rico emerges from storm
Supermarkets are gradually re-opening in the hurricane-ravaged San Juan capital but the situation is far from normal and customers are going home disappointed
4:04AM ( 1 day ago )
AP Business - Utilities
Issues remain as 3rd round of NAFTA talks wraps in Ottawa
Contentious issues remain in NAFTA renegotiations as the U.S., Canada and Mexico conclude a third round of talks
4:38PM ( 8 minutes ago )
Lawsuit: Kushner Cos. charges illegal fees to its tenants
The real estate company run by the family of Jared Kushner has been sued by two tenants in Maryland for allegedly adding excessive and illegal fees to their rent
4:37PM ( 9 minutes ago )
Dark days for Senate Leader McConnell as losses cast doubt
Senate Republicans are reckoning with an insurgent's win in Alabama that poses clear threats to their own grip on power and the leadership of Majority Leader Mitch McConnell of Kentucky
4:33PM ( 13 minutes ago )
Baseball owners approve sale of Marlins to Derek Jeter group
Person familiar with situation says major league owners have approved the sale of the Miami Marlins by Jeffrey Loria to an investment group led by Bruce Sherman and Derek Jeter.
4:29PM ( 16 minutes ago )
Trump in salesman mode as he tries to score a tax cut win
Trump tries to build momentum for tax plan, score a legislative win
4:25PM ( 21 minutes ago )