US stocks rise on tax cut hopes

US stocks rise on tax cut hopes


The Dow Jones industrial average closed 40.26 up at 11,410.32

An encouraging trade report and signs that a tax cut package would pass the Senate have sent US stocks edging higher.

The American government reported on Friday that the US trade deficit fell to its lowest level in nine months in October.

Growing demand for American goods overseas pushed exports to their highest level in more than two years. The trade deficit narrowed to 38.7 billion US dollars (£24.5 billion), 13.2% below September’s deficit of 44.6 billion US dollars.

The Dow Jones industrial average rose 40.26, or 0.4%, to close the week at 11,410.32.

General Electric led the 30 stocks that make up the index with a 3.4% jump to 17.72 US dollars (£11.20). GE announced on Friday that it planned to raise its dividend by 17%.

The Standard & Poor’s 500 index rose 7.40, or 0.6%, to 1,240.40. All 10 company groups that make up the index rose.

It was the third straight day that the S&P index closed at a new high for the year. It has gained 11.2% this year.

The Nasdaq composite index rose 20.87, or 0.8%, to 2,637.54.

Prospects were improving that the Senate would approve legislation aimed at avoiding sweeping tax increases January 1. Negotiators added a few sweeteners to promote ethanol and other forms of alternative energy. A test vote was set for Monday.

House Democrats have balked at the proposal to extend tax cuts, voting in a closed-door meeting Thursday not to allow the package to reach the floor for a vote without changes to scale back tax cuts for the rich.

Leave a Reply

Be the First to Comment!