The major U.S. index futures are pointing to a lower opening on Thursday, with stocks poised to give back ground after the upward move seen in the previous session.
The downward momentum on Wall Street comes as traders continue to digest the tax reform plan unveiled by President Donald Trump.
The long-awaited tax reform plan is seen as the biggest overhaul to the U.S. tax system in thirty years and includes a reduction in the corporate tax rate to 20 percent.
While Republicans did not provide details about the cost of the tax cuts would be offset, Trump’s top economic advisor Gary Cohn predicted the plan would be paid for by economic growth.
“We think we can drive a lot of business back to America, we can drive jobs back to America, we can make ourselves very competitive,” Cohn told CNBC. “We think we can pay for the entire tax cut through growth over the cycle.”
Stocks moved mostly higher over the course of the trading day on Wednesday following the lackluster performance seen in the previous session.
The major averages all closed in positive territory, although the tech-heavy Nasdaq outperformed its counterparts. While the Nasdaq jumped 73.10 points or 1.2 percent to 6,453.26, the Dow rose 56.39 points or 0.3 percent to 22,340.71 and the S&P 500 climbed 10.20 points or 0.4 percent to 2,507.04.
The strength on Wall Street was partly due to a positive reaction to the release of a Republican tax reform plan, which calls for a reduction in the corporate tax rate to 20 percent.
Buying interest was also generated by a report from the Commerce Department showing a bigger than expected jump in durable goods orders in the month of August.
The report said durable goods orders surged up by 1.7 percent in August after plunging by 6.8 percent in July. Economists had expected orders to climb by 1.0 percent.
Excluding an increase in orders for transportation equipment, durable goods orders edged up by 0.2 percent in August after climbing by 0.8 percent in July. The uptick matched economist estimates.
The Commerce Department also said orders for non-defense capital goods excluding aircraft, an indicator of business spending, rose by 0.9 percent in August after climbing by 1.1 percent in July.
Michael Pearce, U.S. economist at Capital Economics said the data suggests that business equipment investment is set for another big gain in the third quarter.
Meanwhile, a separate report from the National Association of Realtors showed a steep drop in pending home sales in the month of…