US: Stocks dip as tax cut progress limits Flynn worries

[NEW YORK] US stocks finished the week on a tumultuous note Friday, tumbling after a former top aide to President Donald Trump pleaded guilty to lying to the FBI, and then bouncing back as a massive tax cut neared passage.

All three major indices declined, but ended well above session lows, boosted by statements by Senate Republican leaders that key tax-cut holdouts were falling into line following concessions.

The Dow Jones Industrial Average finished the week down 0.2 per cent at 24,231.59, recovering before the close from the session low after diving more than 350 points.

The broad-based S&P 500 dropped 0.2 per cent to 2,642.22, while the tech-rich Nasdaq Composite Index shed 0.4 per cent to 6,846.59.

Stocks swooned after former White House National Security Advisor Michael Flynn's pleaded guilty and said he would cooperate with prosecutors on the probe into possible collusion between the Trump campaign and Moscow.

Leading news commentators said the Flynn developments bring the probe closer to Trump and his family.

A tweet from leading ABC News reporter Brian Ross said Flynn was prepared to testify that as a candidate Trump "directed him to make contact with the Russians". But buyers soon returned to the stock market as more Republicans endorsed the tax cut.

"We have the votes," Senate Majority Leader Mitch McConnell told reporters as he entered the chamber.

Phil Davis of PSW Investments said, "As long as investors think tax cuts are going to be applied they won't sell. The Republicans and the traders are in complete denial of what is happening."

AFP