Wall Street hits new records as healthcare stocks rise

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– All three major indexes hit record levels in early trading on Tuesday as healthcare stocks rose on robust earnings and investors remained upbeat about a cut in corporate taxes.

Trader Greg Rowe reacts after the closing bell on the floor of the New York Stock Exchange (NYSE) in New York City, New York, U.S., October 27, 2017. REUTERS/Brendan McDermid

Shares of Valeant Pharma surged 14.2 percent after the company’s profit beat Wall Street estimates due to strength in its eye-care Bausch + Lomb business.

Mylan rose 2 percent, a day after the drugmaker raised its full-year forecast.

Negotiations on President Donald Trump’s tax bill have begun after House Republicans last week unveiled a first draft that proposed a range of cuts aimed at helping businesses, including slashing the corporate rate to 20 percent from 35 percent.

With more than 400 of S&P 500 companies having reported, earnings for the third quarter are expected to have climbed 8 percent, compared with expectations of a 5.9 percent rise at the start of October, according to Thomson Reuters I/B/E/S.

The S&P has risen about 15 percent in 2017 on the back on strong earnings, an improving economy and Trump’s promise to cut taxes.

“While the market remains in place for further gains, the unwinding of the earnings season is likely to slow the pace of gains as the battle of tax reform lurks in the background,” said Peter Cardillo, chief market economist at First Standard Financial.

At 9:39 a.m. ET (1339 GMT), the Dow Jones Industrial Average was up 33.59 points, or 0.14 percent, at 23,582.01, the S&P 500 was up 3.99 points, or 0.15 percent, at 2,595.12.

The Nasdaq Composite was up 2.59 points, or 0.04 percent, at 6,789.02.

Eight of the 11 major S&P sectors were higher, with the health index’s 0.34 percent rise leading the advancers.

Investors are also awaiting a speech from outgoing Federal Reserve Chair Janet Yellen and Fed Vice Chair for Supervision Randal Quarles.

Yellen will give acceptance remarks at a presentation of the Paul H. Douglas Award for Ethics in Government in Washington at 2:30 p.m. ET.

Her speech will come less than a week after President Donald Trump chose Fed governor Jerome Powell to replace Yellen at the end of her term in 2018.

Shares of Priceline Group were down 9.1 percent after the online travel services company gave a softer-than-expected guidance for the fourth quarter.

Weight Watchers jumped 11.3 percent after the weight management company raised its profit forecast.

Advancing issues outnumbered decliners on the NYSE by 1,313 to 1,206. On the Nasdaq, 1,267 issues fell and 1,087 advanced.

Reporting by Tanya Agrawal; Editing by Arun Koyyur

Our Standards:The Thomson Reuters Trust Principles.

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