Investing.com – U.S. stocks closed lower on Monday as gains in tech stocks were offset by a slump in financials following a report suggesting that the House is considering a plan that would gradually lower the U.S. corporate tax rate.
The Dow Jones Industrial Average closed higher at 23,348.74. The S&P 500 closed 0.32% higher while the Nasdaq Composite closed at 6698.96, down 0.03%.
In what was quiet day on calendar for top-tier corporate earnings, investors mulled over a Bloomberg report suggesting that the U.S. House of Representatives was discussing a gradual tax cut that that would lower the corporate tax rate to 20% in 2022.
On the economic data front, the trend of stuttering inflation continued while consumer spending grew at its fastest rate since August 2009.
The Federal Reserve's preferred inflation measure, the personal consumption expenditures (PCE) price index excluding food and energy, rose 1.3% in the 12 months through September.
That was in-line with expectations but well below the Fed’s 2% target, fueling expectations that the trend of subdued inflation will keep interest rates lower for longer.
Consumer spending, which accounts for more than two-thirds of U.S. economic activity, jumped 1% last month, the Commerce Department said on Monday.
The duo of reports come ahead of the Federal Reserve's two-day policy meeting which gets underway on Tuesday.
A surge in the tech stocks helped limit losses in the broader market as sentiment on tech remained elevated following a slew of better-than-expected earnings from Amazon (NASDAQ:AMZN), Microsoft (NASDAQ:MSFT) and Google-parent Alphabet (NASDAQ:GOOGL) last week.
'Bulls and Bears' on Wall Street
The top Dow gainers for the session: Apple (NASDAQ:AAPL) up 2.3%, The Travelers Companies Inc (NYSE:TRV) up 1.2% and Boeing (NYSE:BA) up 1.1%
Merck (NYSE:MRK) down 6.1%, Verizon Communications Inc (NYSE:VZ) down 2.1% and General Electric (NYSE:GE) down 1.8%, were among the worst Dow performers of the session.