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US: Stocks end mostly higher ahead of legislative vote

Thursday, March 23, 2017 - 06:51

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[NEW YORK] US stocks mostly rebounded on Wednesday ahead of a key congressional vote on health care, but doubts about the prospects for President Donald Trump's broader agenda weighed on European and Asian equities.

Markets in Asia finished firmly down, with the Nikkei losing 2.1 per cent following negative momentum from Tuesday's US equity rout and worries about reports that North Korea may have launched several missiles Wednesday morning. South Korea's defence ministry later said the missile test failed.

Bourses in Europe also fell, including in London, where the parliament was put on lockdown after an attack outside the building that left four people dead, including the assailant.

The attack, however, had little measurable impact on London's stock index which closed only marginally lower than its European counterparts.

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Market voices on:

"Even though this news is terrible, financial markets are not reacting to it too strongly," City Index analyst Kathleen Brooks told AFP.

US stocks fell sharply on Tuesday on doubts about Mr Trump's ability to win passage in the House of Representatives of a health care replacement bill, seen as an early proxy vote of his capacity to advance promised tax reform and other growth initiatives.

"After four plus months of promises and two months in office, investors are worried that the Trump rally has gone too far on promises alone, now desiring some proof," said Mike van Dulken, analyst at Accendo Markets in London.

But US stocks showed signs of resilience Wednesday, with the Nasdaq gaining a solid 0.5 per cent and the S&P 500 also positive.

Investors were taking a wait-and-see attitude after Mr Trump's allies in Congress did not delay the health care vote set for Thursday, suggesting confidence, said Art Hogan, chief market strategist at Wunderlich Securities.

"In general, this is a market that's been driven by pro-growth policies," Mr Hogan said. "Anything that appears to be delaying tax reform will be seen as a negative."

Among individual companies, Nike sank 7.1 per cent after it reported that third quarter sales missed expectations, and warned that a tough North American retail market would crimp profits in the upcoming quarter.

Marriott International jumped 3.4 per cent after it mapped out plans at an investor day to add up to 300,000 rooms worldwide by 2019.

AFP

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