A currency trader walks near a screen showing the Korea Composite Stock Price Index (KOSPI) at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Thursday, April 22, 2021. Asian shares were higher on Thursday after a broad advance on Wall Street led by technology companies and banks.
Currency traders walk near screens showing the Korean Securities Dealers Automated Quotations (KOSDAQ), left, and the foreign exchange rates at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Thursday, April 22, 2021. Asian shares were higher on Thursday after a broad advance on Wall Street led by technology companies and banks.
Currency traders talk near screens showing the Korea Composite Stock Price Index (KOSPI), left, and the foreign exchange rate between U.S. dollar and South Korean won at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Thursday, April 22, 2021. Asian shares were higher on Thursday after a broad advance on Wall Street led by technology companies and banks.
A currency trader works at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Thursday, April 22, 2021. Asian shares were higher on Thursday after a broad advance on Wall Street led by technology companies and banks.
FILE – In this March 23, 2021 file photo, pedestrians walk past the New York Stock Exchange in New York’s Financial District. Stocks are opening modestly lower on Wall Street, Thursday, April 22, led by drops in banks and technology companies.
In this photo provided by the New York Stock Exchange, trader Fred DeMarco, right, works on the floor, Thursday April 22, 2021. Stocks wobbled between small gains and losses Thursday as investors continue to focus on company earnings reports and the economic recovery.
In this photo provided by the New York Stock Exchange, trader Robert Greason, left, right, works on the floor, Thursday April 22, 2021. Stocks wobbled between small gains and losses Thursday as investors continue to focus on company earnings reports and the economic recovery.
Stocks turned lower Thursday following a report saying President Biden will propose a hefty tax increase on the gains wealthy individuals reap from investments.
Investors who earn $1 million or more would have to pay a 39.6% tax rate on any capital gains, nearly double the current rate for Americans in that income bracket, according to the report by Bloomberg. A separate surtax on investment income could boost the overall federal tax rate for wealthy investors as high as 43.3%, the report said, citing unnamed people familiar with the proposal.
The S&P 500 was down 0.8% as of 2:35 p.m. Eastern, having shed an earlier gain. The Dow Jones Industrial Average fell 302 points, or 0.9%, to 33,829. The Nasdaq was 0.8% lower. The S&P 500 closed higher Wednesday, ending a two-day slide, but it’s still down for the week.
The selling was widespread, with every sector in the S&P 500 lower. Technology stocks, banks and companies that rely on consumer spending, accounted for much of the decline. Treasury yields held steady.
“The things that the market is going to react to are the unknowns,” said Andrew Mies, chief investment officer of 6Meridian. “The knowns are the economy is good and improving, earnings are good and vaccinations are going pretty well in the United States. The things the market doesn’t know are tax policy, both at the corporate and individual level, and what the Fed is going to do in the next 12 to 18 months.”
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