Dow jumps 310 points after Trump says he's weighing a capital-gains tax cut
- US equities gained on Tuesday on new hopes for a capital-gains tax cut and wary optimism about a Russian coronavirus vaccine.
- President Donald Trump said on Monday afternoon that he was considering lowering the US capital-gains tax. Such a move would increase investors' realized profits but would likely face legal challenges if done through an executive order.
- Investors also mulled Russia's announcement that it had developed and approved the world's first successful coronavirus vaccine. While news of vaccine progress has previously lifted
markets, the lack of phase-three testing of the vaccine has made several health authorities skeptical of its safety.
- Oil gained after US COVID-19 hospitalizations sank to their lowest level in a month. West Texas Intermediate crude rose as much as 2.4%, to $42.94 per barrel.
- Watch major indexes update live here.
US stocks rose on Tuesday after President Donald Trump called for a capital-gains tax cut.
The president said on Monday afternoon that was considering lowering the US capital-gains tax, a move that would boost investors' realized profits. Trump decided against such a cut in September, saying it did too little for the middle class.While the president can't unilaterally slash the capital-gains tax rate, he could adjust it by the level of inflation through an executive order. Still, such a move would likely prompt legal challenges.
- S&P 500: 3,377.46, up 0.5%
- Dow Jones industrial average: 28,106.66, up 1.1% (315 points)
- Nasdaq composite: 10,971.00, up 0.03%
Clinical trials of the vaccine took place over just two months, and the Russian government approved its use before phase-three studies, set to begin on Wednesday."I know that it works quite effectively, forms strong immunity, and, I repeat, it has passed all the needed checks," Putin said on Tuesday, according to Reuters. The president added that one of his daughters received the vaccine. Read more: Morgan Stanley breaks down 4 reasons why the next stock bull market is just getting underway — and lays out the best investing strategy for taking advantage
Investors also cheered news that US COVID-19 hospitalizations fell to their lowest level in a month, suggesting the country's surging death toll could soon slow.
Inovio Pharmaceuticals tumbled after missing quarterly estimates. The company also announced that the next trials of its experimental coronavirus vaccine would begin in September, later than expected.Read more: JPMorgan says buy these 19 'diamond in the rough' stocks that have plunged from yearly highs, but are spring-loaded for huge gains ahead
The Chinese electric-car maker Nio erased initial gains as the company's earnings beat drove a wave of profit-taking. The Tesla competitor beat second-quarter expectations and posted a positive gross margin for the first time ever. Nio also guided for record revenue and vehicle deliveries in the third quarter. Yet the largely positive report wasn't enough to fuel gains, as stronger-than-usual selling pushed shares into the red in the first 30 minutes of trading.
Oil futures climbed as the falling US hospitalizations boosted hopes for a demand rebound. West Texas Intermediate crude gained as much as 2.4%, to $42.94 per barrel. Brent crude, the international benchmark, jumped 1.8%, to $45.78 per barrel, at intraday highs.Now read more markets coverage from Markets Insider and Business Insider:
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