U.S. Bank Stocks Surge After U.S. Senate Vote on Tax Reform
In the early morning hours on Saturday, December 2, the Republican-controlled U.S. Senate voted by a 51-49 margin to approve a momentous tax reform bill. The bill will see corporate taxes fall from 35% to 20%, as well as a number of other provisions that the Trump administration has said will spur growth.
The Dow Jones Industrial Average Index was up triple digits in late morning trade on December 4.
Shares of JPMorgan Chase & Co. (NYSE:JPM) were up 2.28% heading into the noon hour on the same trading day. The head of JPMorgan U.S. equity said in early October that the passing of the tax reform bill could spark a run to 2,700 points on the S&P 500 Index and add $10 to 2018 earnings per share. In September CEO Jamie Dimon called passing of tax reform “the single most important thing bar none right now”.
Goldman Sachs Group Inc. (NYSE:GS) stock was up 1.3% heading into the noon hour. Shares of Goldman Sachs have climbed 10% since September 4 as the tax reform push has picked up momentum. Two of the main architects of the reform bill are former Goldman Sachs executives – senior advisor to the Trump administration Gary Cohn and Treasury Secretary Steven Mnuchin.
There are still several changes that may be made to the tax bill as Republicans gear up for the final push. Still, it appears the gains seen on Wall St. in anticipation of the first round of pro-growth policies trumpeted by the new administration will be safe heading into 2018.