Wall Street set for strong open

  • Over the weekend, Senate Republicans managed to narrowly pass a bill to revamp the country’s tax system
  • U.S. drugstore operator CVS Health is to buy Aetna, a U.S. health insurer, for $69 billion

U.S. stock index futures pointed to a strong positive open on Monday, as sentiment was boosted by news that the U.S. Senate narrowly passed a major tax bill over the weekend.

In the early hours of Saturday morning, Senate Republicans managed to narrowly pass a bill to revamp the country’s tax system. The final vote came out as 51-49 in favor, after Republicans had to rework the bill late on Thursday.

Consequently, the news put a smile on investors faces ahead of Monday’s open, with the Dow Jones industrial average pointing to higher open, by more than 200 points, at 2:00 a.m. ET.

While tax was supposed to dominate sentiment in the previous trading session, markets closed lower on Friday after having been taken on a roller coaster ride.

U.S. stocks finished in the red Friday after a report emerged stating that former national security advisor Michael Flynn was directed by Trump to talk to Russians.

ABC News had initially reported on Friday, citing an unnamed source, that Flynn was getting ready to testify that he made proposals to the Russian ambassador at Trump’s request, during the run-up of the 2016 U.S. election. The media outlet went on to correct the report, stating that Flynn would likely say that Trump’s instructions had occurred after the election took place.

Shifting to Monday, investors will be poring over news that U.S. drugstore operator CVS Health is to buy Aetna, a U.S. health insurer, for $69 billion. The agreement is seen as one of 2017’s biggest deals so far in the M&A (merger and acquisition) space.

Ascena Retail and Coupa Software are expected to publish earnings on Monday. Meanwhile on the data front, factory orders are set to be published at 10 a.m. ET.

In commodities, oil cartel OPEC and non-OPEC producing nations such as Russia agreed to limit their production output through to the end of next year. While oil price rose on the back of the news last week, prices are trading in the red Monday, following news that U.S. shale drillers had added more rigs in the previous week.

Looking to markets in other regions, European shares pointed to a positive open on Monday, while markets in Asia traded relatively mixed as investors eyed trade on Wall Street.

Alexandra Gibbs

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