Stocks rise, end Dow’s 8-day skid

Banks and other financial companies led U.S. stock indexes sharply higher Tuesday, snapping an eight-day losing streak for the Dow Jones industrial average.

The Dow rose 150.52 points, or 0.7 percent, to 20,701.50. The 30-company average’s decline in the previous eight trading days was its longest slide in more than five years. The Standard & Poor’s 500 index added 16.98 points, or 0.7 percent, to 2,358.57. The Nasdaq composite index gained 34.77 points, or 0.6 percent, to 5,875.14.

Bond prices edged lower. The 10-year Treasury yield rose to 2.42 percent from 2.38 percent.

The rally was broad, with materials and industrial companies among the biggest gainers. Energy stocks notched a big gain as crude oil prices moved higher.

Investor optimism that Congress and the White House are pivoting to tax cuts and other business-friendly policy proposals, after spending recent weeks focused on health care, helped send the market higher, said JJ Kinahan, chief market strategist at TD Ameritrade.

“It seems like both sides of the aisle do want to get something done around tax reform,” Kinahan said. “That’s all the market is really hanging its hat on.”

Since Donald Trump’s presidential election win in November, investors have been optimistic that the administration would deliver on promises to lower taxes, loosen regulations for companies and institute other business-friendly policies. Republicans’ failure to repeal the Patient Protection and Affordable Care Act last week dashed some of that optimism, pulling down stocks. But this week, Republicans appear to be shifting their focus to tax cuts, among other issues.

“The market is sort of in a holding pattern waiting for additional clarity from the administration on corporate tax reform,” said Nadia Lovell, U.S. equity strategist at J.P. Morgan Private Bank.

Traders also got some encouragement from the latest Standard & Poor’s CoreLogic Case-Shiller home-price index, which showed that U.S. home prices rose in January at the fastest pace in more than two years.

Mortgage rates are rising, but that’s not expected to affect home sales yet because hiring is still strong, rates are still low, and there aren’t a lot of homes on the market. That’s a positive combination for homebuilders, many of which have seen their stocks move sharply higher this year. Beazer Homes USA notched the biggest gain among builders Tuesday, adding 38 cents, or 3.3 percent, to $12.06. But the company’s stock remains down 9.3 percent this year.

Shares of Darden Restaurants jumped 9.3 percent after the owner of Olive Garden reported strong quarterly results and said it will buy the Cheddar’s Scratch Kitchen chain for $780 million. Cheddar’s has 165 locations in 28 states. Darden was the biggest gainer in the S&P 500, rising $7.04, or 9.3 percent, to $82.62.

Benchmark U.S. crude rose 64 cents, or 1.3 percent, to close at $48.37 per barrel in New York. Brent crude, used to price international oils, climbed 58 cents, or 1.1 percent, to close at $51.33 a barrel in London.

In metals trading, the price of gold slipped 10 cents to settle at $1,255.60 an ounce. Silver rose 14 cents to $18.25 per ounce. Copper added 4 cents to $2.68 per pound.