Stocks end mixed on tax proposals

Investors shrug off expected nomination of Powell to Fed; company forecasts continue

U. S. stocks finished mixed on Thursday as investors pored over House Republican’s tax proposals and President Donald Trump picked Fed Governor Jerome “Jay” Powell to lead the Federal Reserve. Weak results from consumer and health care companies pulled those parts of the market lower.

The House tax plan would temporarily cut the top corporate tax rate to 20 percent from 35 percent. That helped smaller, more U.S .- focused companies, because they generally pay higher tax rates than larger firms that do a lot of business in other countries. Home improvement retailers and homebuilders slumped because the billwould reduce the amount of interest Americans can deduct on new mortgages. That could hurt home sales, particularly in high- cost areas.

The GOP tax plan was mostly what investors expected, said Mona Mahajan, U.S. investment strategist for Allianz Global Investors. She noted that the bill would immediately lower the corporate tax rate instead of reducing it over time, an idea some Republicans had proposed earlier.

“That alone is a win for corporations becoming more competitive with global peers, especially the small cap and domestic companies,” she said.

The choice of Powell also didn’t surprise Wall Street, as he had been seen as the most likely pick for a week or so.

The Standard & Poor’s 500 index rose 0.49 points to 2,579.85. The Dow Jones industrial average added 81.25 points, or 0.3 percent, to a record 23,516.26. The Nasdaq composite sank 1.59 points to 6,714.94. The Russell 2000 index of smaller- company stocks picked up 3.77 points, or 0.3 percent, to 1,496.55. Slightly more stocks on the New York Stock Exchange fell than rose.

Luxury homebuilder Toll Brothers sank $ 2.84, or 6.1 percent, to $ 43.79. Retailer Home Depot fell $ 2.67, or 1.6 percent, to $ 162.71.

Several notable companies plunged after they cut their annual forecasts. Sharpie and Rubbermaid makerNewell Brands tumbled $ 10.99, or 26.6 percent, to a three- year lowof $ 30.01. Underwear and sock maker Hanesbrands lost $ 1.93, or 8.8 percent, to $ 20.08.

In electronic trading, Apple climbed 3.5 percent after its fiscal fourth- quarter results and its forecasts were better than expected.

U. S. crude oil rose 24 cents to $ 54.54 a barrel in New York. Brent crude, the standard for international oil prices, picked up 13 cents to $ 60.62 a barrel in London.