Wall Street surged to record highs on Tuesday led by sharp gains in bank stocks, and boosted by progress for a tax cut bill, strong consumer confidence data and encouraging comments from President Trump’s nominee to lead the Federal Reserve. As a result, all three major equity indexes chalked up record closing highs.
The S&P financial sector gained 2.6 percent, its largest daily percentage increase since March 1. JP Morgan rose 3.5 percent and Bank of America was up 3.9 percent, while the S&P 500 bank index rose 3.3 percent.
Trump’s push for a large package of tax cuts moved past a potential obstacle as a Senate panel approved the measure despite lingering concerns from some Republican members. Wall Street is closely watching progress on the Republicans’ tax-reform efforts, with hopes that corporate tax cuts will further fuel the record-setting rally for equities.
The small-cap Russell 2000 , which is viewed as a barometer for tax reform’s chances, rose 1.5 percent and also chalking up a record closing high.
In testimony before a Senate committee, Jerome Powell, nominated to replace Janet Yellen as Fed chair, defended the need to potentially lighten regulation on the financial sector.
Powell presented himself as an extension of the Fed policies set under Yellen and her predecessor Ben Bernanke, confirming market expectations that he offered stability despite the change in Fed leadership.
Data indicated that consumer confidence rose to a near 17-year high in November, driven by a robust labor market, while house prices rose sharply in September in the latest encouraging reports regarding the economy.
Major indexes briefly pulled back from session highs after news that North Korea had fired a missile, before they rebounded.
In corporate news, Buffalo Wild Wings shares rose 6.3 percent after Roark Capital Group said it would acquire the chicken wing restaurant chain.