U.S. stocks rebounded on Friday as Wall Street reassessed concerns arising from news that the White House could seek a hike to the capital gains tax.
The Dow Jones Industrial Average gained 227.59 points, or 0.7%, to 34,043.49 amid a jump in Goldman Sachs and JPMorgan shares.
The S&P 500 rose 1.1% to 4,180.17 led by financials and materials, while the tech-heavy Nasdaq Composite climbed 1.4% to 14,016.81.
The S&P 500 closed the turbulent week with just a 0.1% loss, while the Dow and the Nasdaq fell 0.5% and 0.3% for the week, respectively.
Wall Street came off a turbulent session for equities after multiple news outlets reported Thursday afternoon that President Joe Biden is slated to propose much higher capital gains taxes for the rich.
Bloomberg News reported that Biden is planning a capital gains tax hike to as high as 43.4% for wealthy Americans.
The proposal would hike the capital gains rate to 39.6% for those earning $1 million or more, up from 20% currently, according to Bloomberg News, citing people familiar with the matter. Reuters and the New York Times later also reported similar stories.
Still, with Democrats’ narrow majority control in Congress, a tax bill like this could face challenges and many on Wall Street believe a less dramatic increase is more likely.
Reference: CNBC
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