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2 November 2017
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U.S. stocks are slipping Thursday morning as Wall Street waits for news
about House Republicans' tax proposals and President Donald Trump's choice for
Federal Reserve chair. Company earnings are also still in focus. Rubbermaid
maker Newell Brands and generic drugmaker Teva are tumbling after they each
slashed their annual forecasts. Technology and consumer goods companies are
falling.
KEEPING SCORE: The Standard & Poor's 500
index fell 7 points, or 0.3 percent, to 2,572 as of 10:05 a.m. Eastern time.
The Dow Jones industrial average shed 36 points, or 0.2 percent, to 23,398. The
Nasdaq composite sank 18 points, or 0.3 percent, to 6,698. The Russell 2000
index of smaller-company stocks gave up 4 points, or 0.3 percent, to 1,488.
TAX PROPOSALS: House Republicans are set to
release their tax plan Thursday after they missed a self-imposed Wednesday
deadline. Ways and Means Committee Chairman Kevin Brady says the GOP hopes to
meet the Trump administration's goal of cutting the top corporate tax rate to
20 percent from 35 percent, but it can't do so permanently. The proposal may
keep the top individual tax rate at 39.6 percent but apply it only to
households that make $1 million a year instead of $470,000.
Other proposals include putting a lower
threshold on the tax deduction for mortgage interest, raising the child tax
credit, and eliminating the deduction for state income taxes while limiting the
deductibility of local property taxes.
FED HEAD: President Donald Trump plans to
announce his choice for Federal Reserve chair Thursday afternoon. Over the last
week reports have said current Fed Governor Jerome "Jay" Powell will
replace current Chair Janet Yellen. Yellen has led the central bank for the
last four years and her term ends in February. Powell is generally seen as
favoring lower interest rates than other top candidates, and investors
generally expect him to keep raising rates at the gradual pace the Fed has
maintained over the last few years.
EARNINGS: Newell Brands, which owns
Rubbermaid, Sharpie, and dozens of other consumer brands, tumbled after it
slashed its estimates for the year. The company said its third-quarter results
were hurt by the bankruptcy of a retail partner, lost earnings from a winter
sports businesses it divested, and higher costs. The stock tumbled $8.99, or
21.9 percent, to a three-year low of $31.99.
Generic drugmaker Teva Pharmaceuticals hit
its lowest price since 2000. The company cut its annual profit and sales
estimates after a disappointing third quarter. It said generic drug sales
dropped 8 percent, partly because Teva and its peers are being hurt by falling
prices for those medications. Revenue from the company's multiple sclerosis
treatment Copaxone fell 7 percent. Teva stock dropped $16.56, or 5.2 percent,
to $304.52.
OIL: Benchmark U.S. crude dipped 2 cents to
$54.28 a barrel in New York. Brent crude, the international standard, fell 28
cents to $60.21 per barrel in London.
BONDS: Bond prices rose. The yield on the
10-year Treasury note declined to 2.36 percent from 2.37 percent. The yield on
the 2-year note fell to 1.61 percent from 1.62 percent.
CURRENCIES: The dollar slipped to 114.13 yen
from 114.22 yen. The euro rose to $1.1649 from $1.1620.
OVERSEAS: The British FTSE 100 index rose 0.4
percent while Germany's DAX fell 0.2 percent. The CAC 40 in France declined 0.3
percent. Tokyo's Nikkei 225 gained 0.5 percent and the South Korean Kospi fell
0.4 percent while Hong Kong's Hang Seng index shed 0.3 percent.The Total Investment & Insurance
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