Global stock markets edged lower on Tuesday, while US Treasury yields rose, as Republican legislation with steep cuts to corporate taxes cleared the House of Representatives and headed towards a final vote in the Senate, Reuters reported.
US stocks hit successive highs ahead of the tax overhaul bill, but modest selling has crept into the market as most traders see the positive impact of the bill as already priced in.
“I really think it might be: buy the rumor, sell the news,” said Jim Paulsen, chief investment strategist with the Leuthold Group in Minneapolis. “Wall Street has had long enough to vet this thing.”
The Dow Jones Industrial Average fell 37.45 points, or 0.15 percent, to end at 24,754.75, the S&P 500 lost 8.69 points, or 0.32 percent, to 2,681.47 and the Nasdaq Composite dropped 30.91 points, or 0.44 percent, to 6,963.85.
The pan-European FTSEurofirst 300 index lost 0.51 percent and MSCI’s gauge of stocks across the globe shed 0.30 percent.
The US House of Representatives approved the tax bill by a vote of 227-203. A Senate decision could come Tuesday night on what would be the biggest US tax overhaul in more than 30 years. However, the US Senate parliamentarian has ruled against three provision of the Republican tax bill, forcing the House of Representatives to hold a second vote on the legislation, Senator Bernie Sanders said.
President Donald Trump is expected to sign the bill into law by the end of the week if it is passed by the Senate.
The plan includes slashing the corporate tax rate to 21 percent from 35 percent, which analysts say would likely increase profits, buybacks and dividend payouts.
A slump in technology stocks, led by Apple Inc, also helped drag markets down in afternoon trading.
Apple shares fell more than 1 percent after broker Instinet downgraded the stock to “neutral” from “buy” on doubts about iPhone X sales.
US Treasury yields rose with the benchmark yield hitting a seven-week high as the tax bill pushed forward.