Stocks were choppy Thursday as investors weighed the pros and cons of the Trump administration's new tax bill. One of the three main indexes did manage to close in positive territory thanks to a big rally in tech stocks.
Ahead of the open, Wall Street was met with news that President Donald Trump's "big, beautiful" tax bill passed the House of Representatives by one vote.
It now moves to the Senate, where lawmakers will attempt to pass it through budget reconciliation, which requires a simple majority vs a filibuster and 60 votes.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
"However, reconciliation comes with its own hurdles," writes Kelley Taylor, senior tax editor at Kiplinger.com, in her comprehensive coverage of Trump's tax bill.
"The Senate's Byrd Rule restricts what can be included, barring provisions that aren't directly related to the federal budget or would add to the deficit outside an approved time frame," she adds.
The bill would make most of Trump's Tax Cuts and Jobs Act (TCJA) of 2017 permanent and is projected to add nearly $3 trillion to the deficit over the next 10 years.
This has plenty of folks spooked over the financial sustainability of the U.S. – a concern that was seen in long-term Treasury yields, which initially spiked on news of the bill's passage.
Cooler heads prevailed as the session wore on, though, with yields on the 10-year and 30-year Treasury notes ending the day down.
As for the main indexes, the Dow Jones Industrial Average closed marginally lower at 41,859, and the S&P 500 shed 2.6 points to 5,842. The Nasdaq Composite hung on for a 0.3% gain to end at 18,925.
Snowflake soars on beat-and-raise quarter
In single-stock news, Snowflake (SNOW) jumped 13.4% after the cloud-based data platform reported higher-than-expected fiscal first-quarter earnings.
SNOW also raised its fiscal second-quarter revenue of $1.035 billion to $1.04 billion on strong enterprise demand for AI products.
"Snowflake delivered strong fiscal Q1 results on broad-based demand and steady consumption trends," says Oppenheimer analyst Ittai Kidron.
"In addition, better-than-expected Snowpark and Dynamic Tables activity and strong AI adoption suggest that newer products are resonating with customers," the analyst adds.
Kidron has an Outperform (Buy) rating on the tech stock and says it's a "top pick."
He notes that if "macro conditions hold, we see room for upside, especially considering the still-nascent AI opportunity, continued product expansion, and the maturing sales and go-to-market motion."
Nike and Amazon rejoin forces
Nike (NKE) rose 2.2% after The Information reported that the athletic apparel and footwear maker said it will resume selling its products on Amazon.com (AMZN, +1.0%).
NKE previously sold its merchandise on Amazon from 2017 to 2019, but ended the partnership as it aimed to boost direct-to-consumer sales.
"Restoring wholesale relationships should be a top priority," wrote Truist Securities analyst Joseph Civello back in October when he upgraded the blue chip stock to Buy. "We think establishing an Amazon partnership can be a game-changer."
On Wednesday, Civello noted that brands such as Adidas (ADDYY) and Deckers Outdoor's (DECK) UGG benefit from selling their products on Amazon "because it enables them to curate a premium shopping experience on a platform that has roughly 48% market share of U.S. e-commerce."
Economic data
It was a busy morning for economic data, and the reports released today continue to show a resilient economy.
Initial jobless claims, for one, fell by 2,000 last week to 227,000. And S&P Global's Flash Manufacturing and Services Purchasing Managers Indexes (PMIs) edged further into expansion territory this month.
However, data from the National Association of Realtors showed that existing home sales fell 0.5% month over month, representing the slowest sales pace for any April going back to 2009.
The average home price, meanwhile, hit a record high of $414,000.
"This downward streak is emblematic of the affordability issues plaguing the housing market," says Charlie Dougherty, senior economist at Wells Fargo.
"Although mortgage rates dipped slightly in the months preceding April sales, they remained elevated above 6.5%, presenting a challenge for homebuyers," he adds.
Related content
- Is the Stock Market Open on Memorial Day in 2025?
- What’s Up With the 10-Year Treasury Bond: Four Financial Experts Weigh In
- Hot Upcoming IPOs to Watch
-
USPS Is Raising Prices for Holiday Shipping: Dates and Increases You Need to KnowWhat the USPS's $16 price hike means for your wallet and your small business.
-
July CPI Report Ignites a Risk-On Rally: Stock Market TodayMarket participants price out worst-case scenarios for tariffs and inflation and will now turn their attention to employment and growth.
-
July CPI Report Ignites a Risk-On Rally: Stock Market Today
Market participants price out worst-case scenarios for tariffs and inflation and will now turn their attention to employment and growth.
-
July CPI Report Boosts Rate-Cut Odds: What the Experts SayThe July CPI report shows that tariffs are having a slight impact on inflation, though not enough to keep the Fed from cutting interest rates.
-
DST Exit Strategies: An Expert Guide to What Happens When the Trust SellsUnderstanding the endgame: How Delaware statutory trust dispositions work, what investors can expect and why the exit is probably more important than the entrance.
-
Think Selling Your Home 'As Is' Means You'll Have No Worries? Think AgainThere are significant risks and legal obligations involved in selling a home 'as is' and by yourself, without a real estate agent.
-
Stocks Slip Ahead of July CPI Report: Stock Market TodayThe latest inflation updates roll in this week and Wall Street is watching to see how much of an impact tariffs are having on cost pressures.
-
What the OBBB Means for Social Security Taxes and Your Retirement: A Wealth Adviser's GuideFor Americans in lower- and middle-income tax brackets, the enhanced deduction for older people reduces taxable income, shielding most of their Social Security benefits from being taxed.
-
Financial Planner vs Investment Manager: Who's the Better Value for You?When markets are shaky, who do you trust with your money? A recent study provides useful insights into the value that different financial professionals offer.
-
I'm a Financial Adviser: This Is How You Could Be Leaving Six Figures in Social Security on the TableClaiming Social Security is about more than filing paperwork and expecting a check. When you do it and how you do it have huge financial implications that last the rest of your life.
