Stocks ended a wobbly day with mixed results on Wall Street Friday as the market cooled off following a two-day rally.
The S&P 500 edged higher and notched a gain for the week, breaking a two-week losing streak. The Dow Jones Industrial Average also rose, while the Nasdaq composite and a measure of small-company stocks closed lower.
The S&P 500 rose 6.50 points, or 0.1%, to 4,455.48.
The Dow Jones Industrial Average rose 33.18 points, or 0.1%, to 34,798.
The Nasdaq fell 4.54 points, or less than 0.1%, to 15,047.70.
The Russell 2000 index of smaller companies fell 10.97 points, or 0.5%, to 2,248.07.
For the week:
The S&P 500 is up 22.49 points, or 0.5%.
The Dow is up 213.12 points, or 0.6%.
The Nasdaq is up 3.73 points, or less than 0.1%.
The Russell 2000 is up 11.20 points, or 0.5%.
For the year:
The S&P 500 is up 699.41 points, or 18.6%.
The Dow is up 4,191.52 points, or 13.7%.
The Nasdaq is up 2,159.42 points, or 16.8%.
The Russell 2000 is up 273.22 points, or 13.8%.7 Stocks That Could Benefit From a Capital Gains Tax Hike
One thing every investor needs to learn is the effect of capital gains on their investments. Every time an investor sells a stock that has appreciated in value, that capital gain is subject to being taxed. Stocks that are held for less than a year pay a short-term capital gains tax rate. Stocks that are held for over a year pay a long-term capital gains tax rate.
In general, a capital gains tax hike is a bearish indicator for stocks. However, there are a couple of strategies that can help investors avoid some of the tax hit. One strategy is to keep your investments in an individual retirement account (IRA) or 401(k). However many higher-income earners want to have more access to the funds in their brokerage accounts.
A sound strategy for these investors involves buying dividend stocks. Dividend income is also taxed (unless it is reinvested), but typically when the capital gains tax rate is raised, the dividend income rate stays the same. This makes dividend stocks more attractive.
Investing in dividend stocks is never a bad idea, but at times when the capital gains tax rate is favorable, growth stocks provide a better reward for investor capital. But when long-term capital gains tax rates go up, those gains can get expensive.
In this special presentation, we’ll give you seven stocks that have a nice dividend yield and a strong story to go along with them.
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