NEW YORK: Wall Street stocks pushed to fresh highs for the fifth day in a row Wednesday, giving a boost to most international equity markets on continued optimism about US economic prospects.
US stocks have been on a tear since last week when President Donald Trump vowed to release details of his promised tax cut plan within two to three weeks.
On Wednesday, Trump reiterated that he would soon release specifics on the plan. Sentiment was further lifted by a hopeful outlook from US Federal Reserve Chair Janet Yellen and solid US data on retail sales and consumer spending.
All of these things lended confidence to the view that the Fed would soon raise interest rates, a positive for financial stocks.
Besides New York, equity markets rose in London, Frankfurt, Paris and Tokyo, which gained 1.0 percent.
Market “bullishness stems from hawkish testimony by Janet Yellen… giving a fillip to a key financial sector whose profitability benefits from higher interest rates”, said Accendo Markets analyst Mike van Dulken.
Art Hogan, chief market strategist at Wunderlich said, “It feels like investors might get the pro-growth part of the platform.”
He added that mounting questions about Trump’s connections to Russia so far are not rattling investors.
Among individual stocks Procter & Gamble jumped 3.7 percent on news that activist investor Trian Fund Management led by Nelson Peltz holds 6.4 million shares worth $575 million in the consumer products giant, according to a securities filing.
Some news reports said Trian has added to the stake since the filing deadline and now holds more than $3 billion in shares. Trian is known for pushing companies to reorganize businesses and return funds to shareholders.
Shares in troubled conglomerate Toshiba plunged almost nine percent — extending Tuesday’s eight percent decline — after warning it faced a 390 billion yen ($3.4 billion) loss in the fiscal year to March, hit by a 700 billion yen writedown at its US nuclear unit Westinghouse.
