While you were sleeping: Wall St slides on US tax reform, Merck

Wall Street slid amid concern about delays in the highly-anticipated tax reform by the Trump administration, while shares of Merck dropped amid disappointment about one of its key drugs.

House tax writers are discussing a gradual phase-in for the corporate tax-rate cut that President Donald Trump and Republican leaders want – a schedule that would have the rate reach 20% in 2022, Bloomberg reported, citing a member of the chamber's tax-writing committee and a person familiar with the discussions.

"That headline just caused bit more weakness," Randy Frederick, vice president of trading and derivatives for Charles Schwab in Austin, Texas, told Reuters. "The optimism about tax reforms and how favourable it might be was very high."

At the close of trading in New York, the Dow Jones Industrial Average fell 85.45 points, or 0.4%, to 23,348.74. The Nasdaq Composite Index eased 0.03% to 6698.96 and the Standard & Poor's 500 Index declined 0.3% to 2572.83.

Earlier in the day, the Nasdaq had touched a record high of 6727.39.

The Dow fell as Merck and General Electric, down 5.6% and 2.5% respectively, outweighed advances by Apple and Travelers, up 2.1% and 1.1% respectively.

Keytruda prospects downgraded
Merck shares fell after several analysts downgraded the stock amid concern about its key drug, Keytruda.

"We are downgrading MRK shares to Equal Weight from Overweight based on diminished upside potential from Keytruda, which is by far Merck's biggest value driver," Barclays analyst Geoff Meacham said in his downgrade note, Reuters reported.

Apple gained amid reports of solid demand for its iPhone X, for which the company began taking orders last Friday.

US Treasuries rose after Reuters reported, citing a source familiar with the matter, that Trump is likely to pick Federal Reserve Governor Jerome Powell as the next head of the central bank.

Mr Trump, who is considering incumbent Janet Yellen and four others including Mr Powell for the top central bank post, will announce his decision on Thursday, a White House official said separately, according to Reuters.

Europe's Stoxx 600 Index fell 0.1%. Germany's DAX Index added 0.1%, the UK's FTSE 100 Index fell 0.2% and France's CAC 40 Index was 0.01% lower.

In Germany, a government report showed consumer prices rose an annual 1.5% in October, which was weaker than economists had predicted.

The data arrived just after the European Central Bank last week said it would ease its assets by €30 billion a month from January, while keeping them at the monthly pace of €60 billion until the end of this year.

The latest euro-zone inflation data are due on Tuesday.

(BusinessDesk)