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By Sara Sjolin and Anora M. Gaudiano, MarketWatch
Broadcom rallies after results
The main U.S. stock benchmarks edged higher in early Thursday trade, driven by gains in the technology, industrials and energy sectors.
Traders focused on continued progress on tax legislation and looked ahead to the monthly jobs report due Friday.
What are indexes doing?
The S&P 500 index was up by 2 points, or 0.1%, to 2,631, after four straight sessions of declines.
The Dow Jones Industrial Average added 32 points, or 0.1%, to 24,174.
The tech-heavy Nasdaq Composite Index outpaced the other benchmarks and was up 20 points, or 0.3%, at 6,795, largely thanks to gains among so-called FAANG stocks: Apple Inc.(AAPL) was up 0.8%, while Alphabet Inc.(GOOGL) rose 0.9%.
What’s driving the markets?
Tech stocks were making something of a comeback after taking a battering earlier this week. From Friday through Tuesday, the tech-heavy Nasdaq fell 1.6%, with analysts largely blaming the drop on profit-taking after a big rally and on concerns about how the U.S. tax overhaul will impact the tech sector.
Both the House and Senate have passed their own versions of the tax bill, and now the two need to bridge their differences and agree on a final bill for President Donald Trump to sign. The Republican-led Senate late Wednesday agreed to begin formal negotiations (https://www.wsj.com/articles/senate-votes-to-begin-tax-overhaul-negotiations-with-house-1512609708) with the House, spurring hopes the final tax overhaul will be completed by a self-imposed deadline of Dec. 22.
Another reason for eyes to turn to Washington was the potential for a U.S. government shutdown. Trump is scheduled to meet congressional leaders on Thursday to discuss a bill to keep the government open. A bill to avoid a shutdown will also be up for a vote in the House on Thursday, after the House Rules Committee on Wednesday put together a temporary funding package.
Read:Here’s how the stock market has handled past government shutdowns (http://www.marketwatch.com/story/heres-how-the-stock-market-has-handled-past-government-shutdowns-2017-12-06)
Investors were also looking ahead to the closely watched nonfarm payrolls report out on Friday.
What are strategists saying?
“The outlook for the Dow has turned near-term corrective,” said Richard Perry, market analyst at Hantec Markets, in a note. “It will be interesting to see now how the bulls react to an intraday rebound. If support can begin to build and hold, then the bulls can begin to think of buying opportunities. Friday’s low at 23,922 is initially supportive, with 24,350 now initial resistance.”
“A decent read-through from the ADP employment change yesterday sets up for a nonfarm payrolls tomorrow, where with a rate hike nailed on for December, a dollar positive/risk positive reaction would meet a positive surprise in the data,” he added.
Which stocks are in focus?
Dollar General Corp.(DG) rose 3.4% after the dollar-store operator posted revenue that topped expectations.
Shares of Broadcom Ltd.(AVGO) climbed 2.2% after it reported earnings that topped Wall Street estimates (http://www.marketwatch.com/story/broadcom-shares-shaky-after-earnings-beat-2017-12-06) late Wednesday.
Lululemon Athletica inc.(LULU) rallied 6.8% after the apparel retailer late Wednesday reported third-quarter earnings and sales above estimates (http://www.marketwatch.com/story/lululemon-shares-jump-on-earnings-sales-beat-2017-12-06).
Okta Inc.(OKTA) shares rose 2% after the identity-management company late Wednesday posted quarterly results that beat forecasts (http://www.marketwatch.com/story/okta-shares-rally-as-results-top-street-revenue-rises-faster-than-sales-expenses-2017-12-06).
Citigroup Inc.(C) share were down 0.8% after the bank said late Wednesday it’s likely to take a $20 billion hit to profits (http://www.marketwatch.com/story/citigroup-likely-to-take-20-billion-hit-from-republicans-tax-plan-2017-12-07) under the new tax plans passed by Congress.
What’s on the docket?
Initial U.S. jobless claims (http://www.marketwatch.com/story/us-jobless-claims-fall-to-5-week-low-of-236000-2017-12-07), a way to measure layoffs, fell by 2,000 to 236,000 in the seven days ended Dec 2. Economists surveyed by MarketWatch had forecast claims to total 240,000.
Consumer credit for October is on the docket at 3 p.m. Eastern.
William Dudley, president of the Federal Reserve Bank of New York, is scheduled to give introductory remarks at the “Higher Education Financing and Costs and Returns of Higher Education” event, held at the Federal Reserve Bank of New York, at 8:30 a.m. Eastern.
What are other markets doing?
Asian stocks closed mixed, while European equities mostly traded higher (http://www.marketwatch.com/story/european-stocks-on-course-to-break-losing-streak-as-betting-shares-catch-a-bid-2017-12-07) in the early going.
The ICE Dollar Index was up 0.1% at 93.718, rising for a fourth straight session.
Oil futures rebounded, rising 0.5%, while gold prices dropped 0.8%.
Bitcoin continued its rally, breaking through $15,000 (http://www.marketwatch.com/story/bitcoin-blasts-through-15000-milestone-soars-20-in-24-hours-2017-12-07), just a day after topping the $14,000 level (http://www.marketwatch.com/story/bitcoin-hitting-new-records-tops-200-billion-in-market-capitalization-2017-12-05) for the first time.
(END) Dow Jones Newswires
December 07, 2017 10:02 ET (15:02 GMT)
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