Wall Street closed out the week on a negative note on Friday, as the major domestic equity indexes fell modestly due primarily to a possible negative fate for the Republicans’ tax overhaul plan.
Investors have been hopeful that a tax bill under debate in Congress will boost corporate earnings and further fuel the stock market’s record-setting run.
Although the House approved a broad package of tax cuts. The debate now shifts to the Senate, where the Senate’s version has already encountered resistance within the Republican ranks.
A Reuters poll showed that nearly two-thirds of more than 60 economists said they were not confident the Trump administration would get the legislation passed this year.
With nearly all of the S&P 500 companies reporting results, third-quarter earnings are expected to have climbed 8.2 percent, according to Thomson Reuters I/B/E/S. The benchmark S&P 500 has rallied more than 15 percent this year, supported by corporate earnings growth and solid economic data.
Abercrombie & Fitch rose 23.9 percent and Gap ended the day on Friday up 7.0 percent after the apparel retailers reported results that exceeded estimates.
Shares of sports retailers were higher because of better-than-expected earnings. Foot Locker rose 28.2 percent, Shoe Carnival chalked up a gain of 29.7 percent and Hibbett Sports gained 15.2 percent.
Twenty-First Century Fox ended the trading day up 6.2 percent on rumors that both Comcast and Verizon were interested in buying parts of its studio and TV operations.
Approximately 6.3 billion shares changed hands on the major domestic equity exchanges, a number that was below the 6.8 billion share daily average over the past 20 trading days.