Stock Market News For Dec 19, 2017

Benchmarks closed in positive territory on Monday following rising optimism that the much awaited Republican tax Bill is likely to be passed this week. This development is expected to reduce U.S. corporate tax rates from 35% to 21%, which in turn led all the three key U.S. indexes to hit their new all-time highs. Additionally, a number of corporate deals also helped boost investor sentiment.

The Dow Jones Industrial Average (DJIA) increased 0.6%, or 140.46 points to close at 24,792.20. The S&P 500 Index (INX) rose 0.5% to close at 2,690.16. The tech-laden Nasdaq Composite Index (IXIC) closed at 6,994.76, gaining 0.8%. A total of 7.1 billion shares were traded on Monday, higher than the last 20-session average of 6.8 billion shares. Advancers outnumbered decliners on the NYSE by a 2.43-to-1 ratio. On Nasdaq, a 2.13-to-1 ratio favored advancing issues. The CBOE VIX decreased 0.3% to close at 9.39.

Tax Cuts Likely this Week

Support from several key policymakers raised optimism that the much awaited Republican tax Bill will be finally passed this week. Lower tax rates are expected to raise dividend payouts, boost share buybacks and improve profits. Optimism surrounding a strong decline in corporate tax rates had a broad-based positive impact on markets.

The Materials Select Sector SPDR (XLB) increased 1.5% and was the best performing sector among the S&P 500. Some opf its key holdings, including LyondellBasell Industries N.V. (NYSE:LYB) and Nucor Corporation (NYSE:NUE) rose 3.3% and 3.2%, respectively. Both the companies have a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Additionally, the Financial Select Sector SPDR (XLF) rose 1% and is expected to gain further following rising tax cut prospects. Some of its key components, Wells Fargo & Company (NYSE:WFC) and Bank of America Corporation (NYSE:BAC) advanced 1.8% and 1.5%, respectively.

Corporate Deals Boost Sentiment

In acquisitions news, Campbell Soup Company (NYSE:CPB) decided to buy Snyder's-Lance, Inc (NASDAQ:LNCE) for $4.87 billion in cash. Both shares of Snyder's-Lance and Campbell Soup increased 4% and 0.1%, respectively. Additionally, Oracle Corporation (NYSE:ORCL) decided to acquire software developer Aconexfor $1.2 billion or about $5.97 per share in cash. Shares of Oracle fell 1.2% on Monday.

Also, Amplify Snack Brands, Inc’s (NYSE:BETR) shares jumped 71.6% after The Hershey Company (NYSE:HSY) decided to buy the popcorn maker for around $921 million or $12 per share. These corporate deals delivered a significant boost to markets.

The Dow marked its 70th record close on Monday and advanced more than 5,000 points for the first time in a year. Moreover, all the three indexes touched record intraday levels, with the Nasdaq rising more than 7,000 points during the day.

Stocks That Made Headlines

McDermott Inks $6B Merger Deal With Chicago Bridge & Iron

In a bid to create a fully-vertically integrated company, McDermott International, Inc. (NYSE:MDR) is set to merge with Chicago Bridge & Iron Company N.V. (NYSE:CBI) in a $6 billion all-stock deal. (Read More)

ExxonMobil, BHP Billiton (LON:BLT) to Terminate Marketing JV in 2019

ExxonMobil Corporation (NYSE:XOM) is likely to end the five-decade old marketing joint venture with BHP Billiton Ltd due to concerns raised by ACCC. (Read More)

Zacks Editor-in-Chief Goes "All In" on This Stock

Full disclosure, Kevin Matras now has more of his own money in one particular stock than in any other. He believes in its short-term profit potential and also in its prospects to more than double by 2019. Today he reveals and explains his surprising move in a new Special Report.

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