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Overnight Markets: US stocks gain on tax reform hopes

Overnight Markets: US stocks gain on tax reform hopes

US stocks surged on Thursday, with the Nasdaq closing at a record, after Steven Mnuchin, the US treasury secretary, said that he expects the Trump administration to reveal its tax reform proposal “very soon”.

The Dow Jones Industrial Average added 174 points, or 0.85%, to 20,579, the S&P 500 gained 18 points, or 0.76%, to 2,356 and the Nasdaq Composite added 54 points, or 0.92%, to 5,917.

Mnuchin’s remarks to reporters in Washington helped renew investor enthusiasm that the administration will not find itself bogged down by the fight over repealing and replacing Obamacare.

Economically sensitive stocks posted the biggest gains. Financials were up 1.8%, while industrials climbed 1.3%. Utilities, telecommunications and consumer staples, all defensive stocks, lagged behind.

The credit card company American Express (AXP.N) closed up 5.9% as the top boost to the Dow Industrials after reporting a smaller-than-expected drop in quarterly profit late Wednesday.

CSX Corp (CSX.O), up 5.6%, was one of the best performers on the S&P 500 after the railroad reported a better-than-expected quarterly net profit driven by rising freight volumes and said it plans to cut costs and boost profitability moving forward.

Philip Morris (PM.N) fell 3.5% as the biggest drag to the benchmark S&P index after the tobacco maker's first-quarter profit forecast fell below estimates.

Steel stocks rallied on President Trump’s announcement of a government probe into whether foreign steel imports are harming national security. US Steel Corp. jumped 7.4%, AK Steel Holding Corp. soared 8.6% and Steel Dynamics Inc. added 6.8%.

Verizon Communications Inc. shares fell 1.1% after the telecom company reported first-quarter earnings that missed Wall Street expectations.

In Asia, share markets were mostly higher on Friday in morning trade after a strong session in the US amid caution following a suspected terrorist shooting in Paris ahead of the first round of the presidential election at the weekend.

Japan's benchmark Nikkei 225 index was up 0.75%. South Korea’s Kospi index surged 0.81% and Australia's ASX 200 made gains of 0.58%.

The mood in greater China was mixed, with the Hang Seng Index higher by 0.5% but mainland Chinese markets trading lower. The Shanghai Composite was off by 0.14% while the Shenzhen Composite inched down by 0.07%.

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