Wall St hits fresh records

Traders work on the Mizuho Americas trading floor in New York. Photo / AP

Equities rose on both sides of the Atlantic, with Wall Street climbing to record highs amid ongoing optimism that US President Donald Trump's tax plans will add to bolstering an upswing in corporate profits.

Stocks still rode high on Trump's latest promise, made last Thursday, to soon announce plans "that will be phenomenal in terms of tax." Investors are also awaiting Federal Reserve Chair Janet Yellen's semi-annual testimony to Congress on Tuesday and Wednesday to gauge the latest on the central bank's plans to hike interest rates three times this year.

"There is a sentiment of optimism around Trump's policies and last comments regarding fiscal promises," Andrea Tueni, a trader at Saxo Bank, told Bloomberg. "We are still following last week's good trend, waiting for more catalysts from tomorrow with Yellen testimony and macro statistics."

A New York Fed report showed US consumer expectations for inflation last month rose to the highest level in almost two years.

In 1.13pm trading in New York, the Dow Jones Industrial Average rose 0.7 percent, while the Nasdaq Composite Index advanced 0.5 percent. In 12.58pm trading, the Standard & Poor's 500 Index gained 0.5 percent.

All three indexes climbed to fresh records, with the Dow reaching 20,416.52, the S&P 500 touching 2,328.31 and the Nasdaq hitting 5,766.18.

"What is underlying this whole Trump rhetoric is that fundamentals in the world, including the US, are getting better," Brent Schutte, chief investment strategist at Northwestern Mutual Wealth Management, told Reuters.

Gains in shares of Caterpillar and those of Goldman Sachs, recently up 2.5 percent and 1.8 percent respectively, led the Dow higher.

Among the latest earnings that bettered expectations was Canada's Restaurant Brands International. Shares of the owner of Burger King and Tim Hortons climbed after it posted quarterly profit that exceeded expectations.

"Our continued focus on guest satisfaction and value creation for all of our stakeholders has resulted in accelerated restaurant development and continued system-wide sales growth at both of our iconic brands, Tim Hortons and Burger King," CEO Daniel Schwartz said in the statement.

The stock traded 2.6 percent higher at C$68.93 (US$52.71) in Toronto as of 12.23pm after earlier rising as high as C$69.10.

In Europe, the Stoxx 600 Index ended the day with a 0.8 percent advance from the previous close. The UK's FTSE 100 Index added 0.3 percent, Germany's DAX Index increased 0.9 percent, while France's CAC 40 Index climbed 1.2 percent.

The European Commission upgraded its economic growth outlook in its Winter 2017 Economic Forecast, predicting euro-area gross domestic product will rise 1.6 percent in 2017 and 1.8 percent in 2018, up from its previous forecasts for 1.5 percent and 1.7 percent respectively.

However, it also warned of "exceptional risks surrounding" its latest outlook.

"The particularly high uncertainty surrounding this Winter Forecast is due to the still-to-be-clarified intentions of the new administration of the United States in key policy areas, as well as the numerous elections to be held in Europe this year and the upcoming "Article 50" negotiations with the UK," the Commission said in a statement.

(BusinessDesk)